Over the past year and throughout the pandemic, restaurants that didn’t do much, if any, home delivery were left scrambling to provide this service.
Well-known national companies such as Grubhub, DoorDash and Uber Eats, which contract with local drivers to pick up orders from restaurants and deliver them to customers, provide a ready-to-go solution, but these services come at a cost. The services take a substantial cut — as much as 10 to 30 percent of order totals — to provide in-app ordering and meal delivery, which leaves restaurant owners with a tough decision in many cases to either raise prices or operate at a loss.
A Lexington trio is flipping the script with a nonprofit, cooperative delivery service that is owned and operated by the restaurants, drivers and subscribers.
Drura Parrish
Drura Parrish, David Coomer and Aaron Withers joined forces to launch Delivery Co-op late last August. Parrish is an entrepreneur known for his work with the online transactional marketplace MakeTime, which was acquired by Maryland web-based procurement fi rm Xometry. Coomer is owner of the eponymous creative marketing consulting agency, Coomer.
Withers, nominated by Coomer and Parrish to speak on their group’s behalf, studied anthropology at the University of Kentucky and was an archaeologist for a time before training as a chef. He’d cooked in highly regarded restaurants such as Noma and Relae in Copenhagen, Den in Tokyo and The Catbird Seat in Nashville, and was working toward opening his own place.
“When I realized I could not open a restaurant during a pandemic, I worked on getting the Delivery Co-op ready to launch and took some computer programing courses,” he said.
Aaron Withers
Now, Withers is working full time to oversee Delivery Co-op's hiring, operations, bookkeeping and other day-to-day functions. He’s also working to expand the number of participating restaurants in the co-op, and potentially launch similar operations in cities like Miami, Louisville and Washington, D.C. Coomer helps with marketing and, along with Parrish, serves as a strategic advisor for the enterprise.
Withers said the goal of Delivery Co-op has been to help restaurants survive the pandemic, but he believes people will continue to expect and depend on delivery services.
Delivery Co-op’s business model, he said, is designed to be equitable and retain good people by returning profits back to restaurants with no delivery fees for customers. Rather, customers pay a monthly subscription, currently $25, that allows for unlimited, fee-free food deliveries from participating restaurants. Restaurant members pay a moderate flat fee every quarter or every month, with no sales percentages taken.
David Coomer
Drivers receive a $10 hourly wage and keep all tips, with a ratio of about one dedicated driver per restaurant. Health insurance is offered to drivers who remain on board at least three months, with profit-sharing options after one year. Additionally, 20 percent of net profits are redistributed to restaurant members and to drivers annually.
Currently there are five full-time drivers, about 400 subscribers and seven participating restaurants, including Athenian Grill, Corto Lima, Bella Notte, CurryCurry Katsu and the Ouita Michel family of restaurants.
Withers said others have reached out about starting similar restaurant delivery co-ops in Louisville and in Dayton, Ohio.
Though interest in growing both regionally and locally — there’s currently a waiting list of 30 to 40 restaurants, Withers said — growth will be scaled to adequately cover drivers’ salaries, with an eventual cap of 50 restaurants in the co-op, he said.
As of late February, the co-op has orchestrated 1,150 total deliveries, which account for more than $48,000 in gross revenue. Delivery Co-op is also experimenting with another innovation — a Delivery Bot for short-range deliveries that’s part of a pilot program in partnership with Italian vehicle manufacturer Piaggio. It’s in the beta test phase now, Withers said, though software is being developed to make the robot more autonomous.
While that’s pretty cool, Withers said the best part is seeing the co-op’s model at work.
“The biggest reward is definitely seeing all of the money that’s going back to the restaurants,” he said.