I Have a Food Startup, Is 10% an Okay Discount on OzB?

Associatedbargainsteve @ takesub.com.au on 08/12/2021 - 21:03
Last edited 09/12/2021 - 13:41 by 2 other users

I've been working on a side-hustle during evenings and weekends for the past couple of months and we're finally ready for the first delivery on 20/12/2021 with my first restaurant partner. My humble goal is to bring local restaurants popular dishes to the public as ready-meals. Forget the mass-produced ready-meals; this is from restaurant kitchens to your fridges.

Is 10% an okay discount on OzBargain? This discount will be forked from my side alone; this is my decision so the restaurant will still get their full share. Meals are $13.50 - $14.50, and for full transparency, there is a $9.90 delivery fee.

Cost is surprisingly high and I never really realise this until I'm running a startup. Makes me wonder how the high discounts are thrown around.

What do you think?

Mod Note: From OP: this thread went a bit Offtopic outside of the original question but thank you for the ideas and feedback.

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  • bobbified on 08/12/2021 - 21:06
    +2

    ..This discount will be forked from my side alone; this is my decision so the restaurant will still get their full share.

    How is this a "partnership" if you're forking out the discount alone?

    • ozcheese on 08/12/2021 - 21:36

      The are plenty of partnerships where the partners take on different roles including financial ones. Perhaps you can expand on the point of your comment?

      • bobbified on 08/12/2021 - 21:46

        In a true partnership, any gains and losses will be shared between the partners.

        OP has specifically said that the discount will be forked out 'alone' so it sounds like his 'partners' are not contributing at all to this promotion, but will be receiving any benefit as a result.

        What else is there to expand on?

        • ozcheese on 08/12/2021 - 22:01

          Your definition of true partnership is not universal, this is a business relationship not a marriage.

          I think I get your point anyway, that the OP is perhaps being too generous with their restaurant partner, and by asking the restaurant partner to share some of the financial burden they could provide a more successful deal on ozb.

          I imagine it was already a big effort to get a restaurant partner and they don't want to jeopardize the relationship this early on, however they do need partners who are committed and won't back out as soon as something misfires. A financial commitment like chipping in on a deal could reveal restaurants who are worth investment from a partnership point of view.

          • Associatedbargainsteve @ takesub.com.au on 08/12/2021 - 22:31
            +2

            @ozcheese: I agree with both views. I'll definitely balance this in future. It's just at the beginning, for the restaurants to be willing to believe in me and a young startup, I'm grateful and is happy to wear some of these cost to get the project started.

    • CheapskateQueen on 08/12/2021 - 22:55

      a general law partnership does not require equal split of income and expenses. the partnership agreement governs all.

      it may be that this arrangement is better described as a joint venture, but seriously, what's your point?

  • SF3 on 08/12/2021 - 21:17
    +4

    10% an okay discount on OzBargain?

    I think it really depends on how it compares with same/similar products.

    Some items people may even Broden at 10% off, some items 50% off no one cares… I don't think it's the discount alone, it is how much it'll cost after discount that matters.

    Who are your competitors? and how does your meals' prices fair against them?

  • KaTst3R on 08/12/2021 - 21:22
    +1

    Makes me wonder how the high discounts are thrown around.

    Those round table Series A capital raises. Yup, that is what is used to fund the discounts. Basically, paying out of pocket to buy market share. The IPO story is always about user growth rather than if we are profitable now for startups.

    • JimmyF on 08/12/2021 - 21:38

      rather than if we are profitable now for startups.

      Uber… 10+ years old, never made a profit.

      At some point the 'growth' has to give way to allow for profit ;)

      But in Uber cases, it is NEVER going to recover all those loses…. It is now a case of tossing good money after bad!

  • pharkurnell on 08/12/2021 - 21:27

    Depends on 10% of what price for what product exactly…

  • SF3 on 08/12/2021 - 21:27

    Forget the mass-produced ready-meals; this is from restaurant kitchens to your fridges

    Who is your target market? it's very different game selling to your least demanding customers vs most demanding customers.

    Mass produced ready-meals haven't gone bankrupted - people buying them sees eating as a "fuel"…

    • Associatedbargainsteve @ takesub.com.au on 08/12/2021 - 23:01

      people buying them sees eating as a "fuel"…

      Agreed. Not them, because small batch cooking in a restaurant kitchen by their original staff and chefs will never be able to compete with food factory's price point.

      If we group restaurants into 'classes', the target market would be those who likes fast casual dining.

  • FLICKIT on 08/12/2021 - 21:32

    10% is reasonable but it may not be enough to entice people away from who they currently use..

    It's an interesting concept, I assume you've researched and tested the best methods to chill the meals fast so you don't end up giving people the shitz, it adds an extra level of risk over just delivering freshly cooked hot meals…

  • morse on 08/12/2021 - 21:36
    +3

    TBH no one is going to get too excited about 10% off. Businesses are often not profiting at all with introductory offers, but be mindful of selling your product too cheaply (might always be expected). OzB may not be the ideal testing ground if it’s not the cheapest in it’s category anyway. Maybe look at targeting mums, corporate or foodie type audiences with 10% off.

  • Jimothy Wongingtons on 08/12/2021 - 21:36
    +5

    Mate just do a service that delivers kfc zinger boxes with a side of Gatorade to hungover people on Saturday’s and sundays

  • Cheaplikethebird on 08/12/2021 - 21:40
    +2

    10% is not a big enough discount for me to sign up.

    Also what is the shelf-life of these meals? At ~$14 with a $9 delivery fee I would need to be ordering 3 meals+ at a time before it even starts to become a more attractive deal than ordering off UberEats.

    • Associatedbargainsteve @ takesub.com.au on 08/12/2021 - 23:09

      I would need to be ordering 3 meals+ at a time

      And that is actually the intent/target. So perhaps my target audience is more for family and couple.

      But to answer your question, it depends on the meals, the one I'm delivering on 20/12 is from a Thai restaurant. They will be cooking Thai curries a day before delivery and quickly freeze them, so these would last more than a month. They'll take reheating into consideration so the meat won't be overcooked. (You can see them via the site by the way, click 'Get Meals')

      • Cheaplikethebird on 09/12/2021 - 08:25
        +2

        $50 for 3x frozen meals? Yeah pass.

        Especially when 3x burger and chips delivered to my door freshly made and not reheated in the micro cost me roughly $72 via UberEats.

        Even ignoring delivery fee, $12 a meal would be the absolute max I would pay for a frozen Thai curry and even then it’s a little bit of a stretch when I can just walk and get a freshly made one for $16 from my local. Probably $10 is when I would start to get interested in using your service.

  • Stopback on 08/12/2021 - 21:41

    Ozbargain is advertising.

  • Thenarrator on 08/12/2021 - 22:03
    +2

    $13.5-$14.5 is standard price for lunch. Not great nor bad, just average. Nothing strikes it as unique so unless it taste exceptionally good, it'll just be that, average. There are lunches that are $8.9 just to get foot in the door. The price itself is already a "non average" which stands out from the crowd.

  • BuyoTheCat on 08/12/2021 - 22:26

    Just to clarify: you only realised how expensive it is until you are running a startup?

    Have you started running your business or are you still in the feasibility phase?

  • netjock on 08/12/2021 - 23:25

    Meals are $13.5 - 14.5

    How much is the restaurant stand take away price? If it is like $20 then it is a decent saving. If the restaurant does UberEats and they take a 25% - 30% cut and you are paying significantly more than UberEats then the restaurant must enjoy their privates being squeezed by the iron fist of Uber.

    Good luck.

  • Savas on 08/12/2021 - 23:44
    -1

    Needs to be at least 75% for ozbargain deal.

  • baker bob on 09/12/2021 - 00:12
    +1

    I don't think you are asking the right question. You need to ask "is my offer water tight or will greedy oz bargainers exploit a loop hole and send me bankrupt?".

  • [Deactivated] on 09/12/2021 - 01:04
    +2

    I think to post on Ozbargain and get good reception
    It needs to be sub $10 per meal and have free delivery for over $100 or something like that. I can get Thai anytime I want for $10 for lunch/allday special, why would I pay more than that?

    You are more expensive than other meal kits, you need to really sell the food and post some photos and stuff too, stressing its restaurant cooked

  • avoidfullprice on 09/12/2021 - 01:18

    As per title, is 10% an okay discount on OzBargain?

    I have no doubt they taste delicious, Are healthier and better than some supermarket frozen meals. Personally, the delivery fee is what it will stop be from having repeated order. If it is $0, the next deal breaker is the cooking instruction to thaw packet and then cook it on stove. While the method would preserve the flavour and taste, is not attractive as people can't just nuking them at work for convenience.

    I want you to succeed and so will say no, 10% discount is not enough on ozbargain. 10% discount on $35 min order will be say $5 per order saving for me (not much) and $5 per order out of pocket for you (adds up). It will unlikely to build up your customer base as effective as other marketing strategy at similar cost.

    On an unrelated note, your product selling point confuses me. It is inconvenient to reheat at work compared to frozen ready meal (and still have to BYO rice), the price point is higher than meals on market. I would order $100 of your curry if I was hosting dinner and want the experience. But I would be ashame of telling my guests they are frozen meals. However if your product is a kit like to spice tailor then it makes sense. So really, I would splurge on your meal once in a blue moon and not order them often like hellofresh

    • [Deactivated] on 09/12/2021 - 01:42
      +2

      At $14+$9.90 shipping the value proposition is not there for me when I can buy fresh cooked food nearby for $10-$15 whatever I want

  • RockyRaccoon on 09/12/2021 - 06:46
    +1

    If I could tell where you are and what your meals are, I might give you an opinion on your question.

    All I get is a box that opens and closes and some promotion for the web development software. Thats not even edible.

    Why doesn’t your website say where your delivery area is without having to load this box of nothing.

    I even tried your profile here, and you don’t give any clues to your location either. Made with ❤️ in Melbourne means nothing, it could easily be the website developers location or is it where the Thai restaurant resides.

    I guess you are trying to look to be a big corporate, which might impress someone, but not customers today.

    Sorry to be so critical, but with the way it is, forget the 10% off, if the site doesn’t work or doesn’t give key info easily, people will need a far bigger discount to even bother looking.

    • mapax on 09/12/2021 - 07:44

      It takes about 20 seconds of the box and then takes you to the meal page. The Thai place is in Carlton.

    • Associatedbargainsteve @ takesub.com.au on 09/12/2021 - 07:45

      How fast did you shut the page where the 'box that opens and closes'? Wait 10 seconds longer? It's a web assembly (but I'm kinda regretting going that path now reading your critical feedback, something to sleep on)

  • FLICKIT on 09/12/2021 - 07:42

    You might want to make things a bit clearer on the site…

    On the main order page you say the meals are refrigerated and you show a picture of a microwave for reheating:
    https://i.postimg.cc/W4xWbdZF/hiw.jpg

    When you dive in to the "Heating Instructions" it says:
    "Defrost pack in the fridge overnight or defrost in the microwave oven. If defrosting in the microwave oven, remember to cut open a corner of the pouch first. Pour thawed content into stovetop pot and cook on medium heat until the curry becomes piping hot and is bubbling. Make sure you keep stirring during the cooking process so that the heat is evenly distributed amongst the dish."

    People may not be happy if they're expecting a meal that only needs a couple of minutes in the microwave and then they receive a frozen meal that needs to be defrosted and heated in a pot…

  • kerfuffle on 09/12/2021 - 07:44

    My humble goal is to bring local restaurants popular dishes to the public as ready-meals. Forget the mass-produced ready-meals; this is from restaurant kitchens to your fridges.

    Thought this was called Providoor?

    • Associatedbargainsteve @ takesub.com.au on 09/12/2021 - 07:50
      -1

      Providoor

      Extremely different price point and market

  • tik tok on 09/12/2021 - 07:49
    +1

    My humble goal is to bring local restaurants popular dishes to the public as ready-meals

    Sorry, I dont understand what you'd be trying to sell. A restaurant's popular dish is already a 'ready-meal'?
    Whats the difference between what you are doing and say Uber Eats?

    • KSMLJ on 09/12/2021 - 08:01
      +1

      10% off and flat $10 delivery.

      • Xistn on 09/12/2021 - 08:58
        +1

        And Frozen…

  • azonki on 09/12/2021 - 09:36

    An old friend of mine tried something similar many years ago. They also had a small retail shop very close to a major train station where they sold both frozen and fresh (cold) meals. All cooked and prepared in commercial kitchens.
    Lasted about two months.
    The delivery service was unreliable, and customers complained that their restaurant meals arrived cold and inedible. Coordinating everything in a timely manner was a nightmare, especially when the drivers (her husband & other family) arrived at a restaurant to pick up meals to find that the kitchen hadn't started because they had a lot of walk-ins.
    This was some time ago, and I hope for your sake that people's expectations have changed.
    But now that we are able to go back to dining out and socialising, I can see Uber Eats and similar fading away till we get another lockdown.
    Only my opinion.

  • Darayus on 09/12/2021 - 09:58

    You need do work out your pricing as variable one which is direct in nature such as labour, Veg, meat & spice & electricity Gas etc. and fixed cost like accountant & legal fees, rent etc.

    You should know how many meals you can prepare in a day and arrive at variable costs. your sale price should recover your variable cost and thereafter your fixed cost and then you can make any margin or profit.

    to arrive at a breakeven point you need to divide your fixed cost by margin on each meal sold. so you should ensure that you need to sell and produce minimum meals to break even at the end of the day.

    Also, you have not mentioned how much quantity you are serving and suits the family of individuals. You should be competitive to the market and you should have some strong reason why your meal is better than local take away.

  • OzHunterNSW on 09/12/2021 - 12:13

    Been done…. I see you selling only to close friends and even then it is only bc they feel pressured.

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