British Columbia

Online restaurants blur line between tech and food companies

They are cropping up in Canadian cities, and trend forecasters predict a rise in restaurants exclusively focused on delivery via app-based ordering systems.

If you've never ordered from an online restaurant, chances are you will soon.

A chef prepares online orders at Accio's commercial kitchen in Victoria. (Khalil Akhtar/CBC)

If you've never ordered from an online restaurant, chances are you will soon.

They are cropping up in Canadian cities, and trend forecasters predict a rise in restaurants exclusively focused on delivery via app-based ordering systems.

This week, the online restaurant reviewing website Yelp got in on the digital ordering game in the U.S. In the U.S., Yelp could end up offering digital delivery from as many as 80,000 restaurants.

Meanwhile, management consulting firm McKinsey & Co., which studied internet food delivery in 16 countries, says the rise of digital technology is reshaping the market for food delivery.

Khalil Akhtar, CBC food columnist and On the Island co-host, stepped behind the scenes of a new one in Victoria to learn why a growing number of restaurant owners are turning to the model.

"We've had conversations about the restaurant industry and how it's becoming way more competitive and way more difficult," said Sterling Grice, who co-owns The Kitchen by Accio and also owns several conventional restaurants.

"This is me trying to adapt. I'm excited about it."

It looks like an ordinary restaurant kitchen at first glance. But it's different. There is no dining room or takeout counter or wait staff.

Handling online orders and refining the app make The Kitchen by Accio as much a tech company as a food business, co-founder Mike Rowe says. (Khalil Akhtar/CBC)

Customers appear as blue dots on a computer screen, rather than people walking in the front door. 

The business at Accio is split in two. One is a traditional restaurant, where a handful of chefs are cooking orders in a kitchen.

But the other part of the operation doesn't look like a restaurant at all. A few blocks away in a light-filled office, software developers work on refining the Accio Kitchen app so that orders can stream seamlessly to the chefs, then to a team of delivery drivers. 

While so-called 'digital food delivery' has been growing in recent years, it is still a small percentage of restaurant business. The McKinsey report said the service represented four per cent of the worldwide restaurant market in 2015.

But as more players — from Amazon to Uber — get involved in digital food delivery, the popularity is inching upward. Whether it affects the traditional restaurant sector depends on how many customers are willing to trade 'eating out' for 'eating in'.

Co-founder Mike Rowe is responsible for the tech side of Accio's business.

"We really focus on creating efficiencies. If you're hungry, you go onto the app, click at most, five or six buttons and food is on its way," Rowe said.

Domino's sets example

The app-based ordering system developed by Domino's pizza chain is viewed as the one to emulate for online restaurant startups like Accio.

When the company was in decline a decade ago, Domino's didn't change the pizza. Instead, it hired a Silicon Valley tech talent to pioneer digital tools.

"I would consider them more of a tech company that happens to make pizzas," Rowe said. 

"That's where we try to get to. People want things to be as easy as possible," he said. "No cash at the door. Your credit card is remembered so you don't have to enter it every time."