Increased Distribution Costs & the Growing Number of Channels

The hospitality and food service industries face rising distribution costs as businesses expand across multiple online and offline sales channels. While a broader reach can drive more sales, it also introduces higher fees, commission rates, and operational complexities.

Key Challenges of Multi-Channel Distribution

1. High Commission Fees from Online Marketplaces & OTAs

📌 Trend: Platforms like Uber Eats, Deliveroo, Just Eat, Booking.com, and Expedia charge commissions ranging from 15% to 35%, significantly cutting into profits.
📌 Impact: Businesses rely on third-party platforms for visibility but lose direct customer relationships and revenue margins.

✅ Solution:

• Optimise direct sales channels (e.g., own website, in-house ordering app).

• Offer incentives for direct bookings (e.g., discounts, exclusive menu items).

• Use AI-driven pricing tools to balance marketplace reliance while maintaining profitability.

2. Managing Multiple Ordering & Booking Channels

📌 Trend: Restaurants and hotels use a mix of direct websites, third-party apps, social media, and in-person sales.
📌 Impact: Siloed data across platforms leads to operational inefficiencies, order confusion, and pricing inconsistencies.

✅ Solution:

• Unify all orders through an integrated POS system (e.g., Plat360form).

• Automate pricing updates across all platforms to maintain rate parity.

• Leverage AI analytics to track sales performance per channel.

3. Delivery Costs & Logistics Management

📌 Trend: As consumer demand for home delivery and takeout grows, businesses face higher delivery fees, fuel costs, and driver shortages.
📌 Impact: Profits decline as delivery services take a larger cut, and managing multiple delivery partners can be complex.

✅ Solution:

• Invest in an in-house delivery team where feasible.

• Use dynamic pricing to adjust menu prices based on platform commission rates.

• Partner with local delivery networks for cost-effective options.

4. Marketing & Advertising Across Multiple Channels

📌 Trend: Increased competition means businesses must spend more on SEO, paid ads, influencer collaborations, and social media marketing.
📌 Impact: Marketing budgets are stretched across Google, Facebook, Instagram, TikTok, and marketplace ads, requiring a high return on investment (ROI).

✅ Solution:

• Use data-driven marketing to focus ad spend on the most profitable channels.

• Automate email and SMS marketing to retain customers without high ad costs.

• Encourage user-generated content and organic social media growth.

How to Reduce Distribution Costs & Maximise Profits

✔ Prioritise direct sales – Encourage direct bookings/orders with exclusive perks.
✔ Unify sales channels – Use an integrated POS and ordering system.
✔ Optimise delivery models – Balance in-house and third-party delivery for efficiency.
✔ Use data analytics – Identify the most cost-effective platforms and focus efforts there.
✔ Streamline marketing – Invest in high-ROI digital marketing strategies.

Would you like a tailored strategy to reduce distribution costs and improve multi-channel efficiency? 🚀