The Strategy Choice of self-support and outsourcing model of Food and beverage enterprises' delivery Service

Abstract

Currently, the catering business offers take-out delivery services to customers because to the severe rivalry in the sector and the development, use, and popularization of information technology. In China, huge Internet delivery platforms are mostly used for catering delivery services, and the service provider is primarily focused on a small number of platforms with competitive advantages. In this profession, there is intense industrial competition and a high barrier to entry. Some big catering chain businesses, including KFC and Pizza Hut under Yum Group, have a delivery service team comprising of its own take-out ordering platform and delivery workers as opposed to delivering through take-out delivery platform. While self-operated take-out ordering and distribution platforms will incur high platform maintenance costs, salaries of distribution service team personnel and other expenses for a long time, and will incur management costs or scale diseconomies of the department, large take-out ordering and distribution platforms require paying high commissions and distribution fees to the platform providers. This article will use the Yum! Brands, i.e., KFC and Pizza Hut brands as examples, which are owned by it and have their own distribution service team and platform for takeout food sales, and compare and analyze the benefits, drawbacks, opportunities, and challenges of the two distribution models using the SWOT analysis method. Based on the analysis, this study examines whether or not catering businesses should have a self-operated delivery service team and under what circumstances they should choose which route to follow for delivery service.