Delivery zones and minimum orders: the four decisions
Delivery areas are usually drawn once, in a hurry, as a circle on a map, and then never touched again. That circle is quietly deciding which orders you lose money on, and nobody ever goes back and checks.
There are only four decisions in it, and they are worth making deliberately.
Circle, postcodes or road distance
- A circle is simple and wrong at the edges, because it measures as the crow flies. A river, a motorway or a one-way system can make a mile on the map twenty minutes in a car.
- Postcode zones match how drivers actually think and let you price by area, but they need setting up properly and a postcode that straddles two zones has to be decided one way.
- Road distance is the most accurate and the most work: real driving distance from your door, priced in bands. Worth it when your area has awkward geography, and overkill when it does not.
The minimum order is where the money is
A minimum order set by area, rather than one number for everywhere, is the single change most takeaways should make. The order that loses money is not the small one nearby, it is the small one at the far edge. Raising the minimum for the furthest zone costs you almost nothing you wanted and removes the drop that ties up a driver for half an hour.
Free delivery over a threshold
Free delivery is a discount, so it should buy you something. Set over a sensible threshold it reliably lifts the basket; set at zero it just reduces every order by the cost of a driver. If you offer it, put the threshold slightly above your current average order, not below it, or you are paying for behaviour you already had.
What happens when you are slammed
Every area should be pausable on its own. The furthest zone is the first thing to switch off when the kitchen is forty minutes behind, because those are the orders that generate the complaints. Quoting an honest longer wait is better than taking the order and hoping.
Check it once a quarter
Pull the last three months of delivered orders, look at the furthest ten per cent, and work out what each actually cost in driver time. Most places find a handful of streets they would rather not serve, or would serve at a higher minimum. That is a ten minute job that pays for itself.
All of this is ordinary configuration in a system you own, and awkward or impossible in one you rent. It is part of how we build your own ordering platform, and if you want the comparison against what the apps charge for the same delivery, the commission calculator does it in your own numbers.