The Second Idea

So, I'm learning more about the needs of the customer. Per Jim Kitchen's emphasis on "lean" methodology, per Diana Kander's emphasis on "All In", customer interviews- open ended questions learning about customers' biggest problems (or 'migraine problems', as Kander calls it)- has led the idea through some twists and turns.

I understand that restaurants want to deliver, but this desire is surrounded by problems. Price, customer service, efficiency, labor, insurance- all of these variables, and a dozen more, make it a headache. In what way would we be able to come up with a solution to help solve the problems?

Well, let's look at how they are currently solving it. Companies like Takeout Central, Crunchbutton, and hundreds of others around the country, some with heavy VC backing like Door Dash, and some with regional market power like Delivery Now in New Jersey, are doing their best. They have a set number of drivers under contract, divide up the shifts, and serve as many restaurants in a region as they can. This way, in exchange for a cut of the profits that varies by company, a restaurant can deliver without the headache of managing drivers. A whole new market opens up to them, they have their menu on line, and they can grow their business enormously.

But obviously, as I learned from interviewing restaurant managers, many are still unhappy with these options. Additionally, personal experience coupled with a survey of the UNC student population told us that end customers- the hungry people who order delivery and drive the whole industry- are also unhappy. High delivery costs, limited options, and, most importantly, slow delivery times make customers annoyed with their options, but resigned to use them, as they don't have any alternatives. How can we create a better model to this existing system?

Well, what do we need to do? Get food to customers faster than anyone, in a way that costs restaurants less. We also need to do all the little things- better customer service, smoother ordering interface, access via mobile and web. But if we can deliver food faster and cheaper, we can win.

I drew pictures, made tables, and wrote whole pages of notes by hand discussing the problem, trying to figure out how to solve it. The problem with current third party delivery services is that they don't have enough drivers. Often they might have just 8 drivers on a weekend dinner shift for 60 restaurants, leading to delivery times of over an hour and a half. So we need more drivers. But managing all their shifts, telling them to work certain times- all of that seems like a headache.

So what do we do to have more drivers on the road, with less pain of managing them? How about an Uber model? If drivers can come in and out whenever they want, as long as we have enough drivers in the system, then only a small percentage of them needs to be working at any time, and we'd already have more people on the road than our competitors. We can serve any number of restaurants, because the more restaurants, the more orders. The more orders, the more business for drivers. The more business, the more drivers want to apply to work. The more drivers in our system, the more restaurants we can serve. And as long as we always have a surplus of drivers, customers will always get their food faster from us, than any alternative.

So we finally had something. An idea very different then our first, inspired by customer interviews, and solving a serious customer 'migraine problem'. We're ecstatic.

We continue to interview, asking more about statistics and metrics than before. How many orders do you do a day? How many drivers do you employee (if you do). We use all of this information, begin coming up with our financials, our marketing plans, our pitch deck. This is a validated idea worth working on. Our amazing team put in hours of work and effort, and beat out the work until we had something to be proud of.

As the semester finished up, our idea was getting better. We though of incentives to make sure we've always had drivers on the road. We had marketing strategies, and recruitment tactics. We had estimates for our revenue streams our our profit projections. Basically, out of an initial idea came a target customer, and out of interviews came a problem, and from the problem a solution. We've got something here, now its time to get validation from others.

All of this work prepared us for the Pitch Party, an annual UNC entrepreneurship pitch competition. Over 100 teams pitch their ideas to judges who walk around the room, giving us monopoly money to reward an idea that they thought deserved backing, culminating in a final "pitch off" of the top 10 teams. We were looking forward to this for a long time, and we were ready! I'll tell you how that went next time, on the Dr. Oz Show with your host- Adriel Oz.

Much love,

A