The Future of Food, Why Third-Party Delivery Apps Fail, and Building a Brand Without a Storefront w/ Andrew Martino (Part 1) - Ep. 35

SPEAKER_01 0:10

Today's guest is Andrew Martino. Andrew is a hospitality entrepreneur and operator with deep expertise in off-premise dining, catering, digital restaurants, and food technology. He's the founder of Ghost Truck Kitchen and Bergen Hall, where he's built and scaled multi-concept restaurant operations. His work sits in the intersection of hospitality, technology, real estate, and operational strategy, with a focus on building scalable, profitable food businesses. Andrew, thanks for being here, man. Welcome.

SPEAKER_00 0:45

Absolutely. Thanks for having me.

SPEAKER_01 0:47

So uh it's funny, you're the second person in the last week uh to talk to me and go down this rabbit hole of the restaurant world, which my eyes were opened up uh last week, I believe it was, to uh exactly some of the shady side of the business, uh you know, particularly as it comes to like the whole Michelin star thing and how how that is uh uh measured and and awarded. Yeah. So I found out. I'm like, this is a pay-to-play, this is crazy. Um but then uh that guest was focused on uh this in-person dining experience, and uh which I think is this is gonna be really interesting and cool to talk to you about really the other side of this, where you are thinking about this industry in terms of the future and where it's going. And uh really I what I think uh from just reading about what you're working on is it's like the new seems to be like a new way of meeting people where they're at with how just consumer behavior as a whole is evolving and changing how people want to experience different things, particularly when it comes to to dining. Uh, obviously, in you know, I call it recent uh history with uh you know platforms like Uber Eats and Doordash and Grubhub and all them um becoming more and more prominent, where you know I we have a client who uh sometimes uh Uber Eats multiple times a day, and it's like that's for some people that's that's how they uh get access to to food and how they prefer to dine. And so like um your the concepts that you've you uh obviously you've built out and that you have now and uh how you're you know, I believe pioneering a different way of doing food. Uh, where did this all start? And is this where you've always seen this industry going? Or was there a point where that shifted?

SPEAKER_00 3:04

Great question. Um I think I only came across it because I was researching for some gentlemen. This was during like the Chipotle fast casual boom. Uh, every single person wanted to be the next Chipotle, right? Oh, we're doing uh this fast casual, it's a bowl concept, it's Indian food, it's everybody wanted to do fast casual. Uh I was investigating and researching all these different restaurants, and something struck me. This is now a decade ago, um, delivery drivers, and they didn't know where to stand, and there was bags everywhere, and there was chaos, and it seemed like there was more delivery drivers coming in and out of these restaurants than there were actually customers sitting inside these places and enjoying the food. And that kind of was a big moment to me that clicked and was like, okay, what if I designed an entire restaurant just based on off-premise? And now today that might seem obvious, but before COVID, there was nobody that was doing it, no one that was focused in off-premise operations and off-premise hospitality. You had a restaurant that maybe happened to deliver, or maybe happened to delivery if you weren't a pizza place or a Chinese food restaurant. Um, so that's what initially got me really excited and into it. Um I think tech enabled us to do this, right? If technology hadn't come along so far, we certainly wouldn't have been able to do what we do now in such a fashion. I do think the world is continuing to move towards digital, but that doesn't mean that I'm giving up on what restaurants are and what they used to be. I just believe those are two completely different experiences. You have an experiential restaurant where you might want to go for a birthday party or a first date or a special dinner, and you really want to be served and feel warmth and taken care of. And then there's utilitarian dining, which is you're hungry and you just need something to eat and you want it to be tasty and convenient and it to make sense for you. Um, and those are like that's the big split I see, and you kind of have to fall into one or the other. And I think a lot of places got caught in between. Um, and even now you see restaurants that treat delivery as incremental. And I think that's the wrong approach. Um, I think you either need to be leaning into it and full bore or kind of figuring out what to do without it. Um yeah, and that that takes us now. It's 2026, and I think just about every restaurant in the world delivers. Some do it really, really well, some do it very, very poorly. Um, and and thankfully we're in the uh the former of that group.

SPEAKER_01 5:45

And so what exactly does it look like for a restaurant to do delivery well and do delivery poorly?

SPEAKER_00 5:54

Yeah. Um, a lot of the same things that make traditional restaurants successful, right? Um that's doing things with intention, that's doing things with care, um, that's having standards, that's having uh operating procedures and rules to follow and things to make it consistent. Uh, and it's taking that same full service approach to take out on delivery food. Um, it can't just be get it out the door, throw it into a box as fast as you can, and hope that it reaches its destination. Um, that's that's a recipe for success. So we try to treat um off-premise hospitality the same way we would if someone was dining in our home, which means you know, we're using technology to reach out to you about 15 minutes after you get your order. Is everything okay? Can we have done something better? You know, um that touch and that hospitality aspect, although it's digital, still is important. It's a big source of feedback for us. Um, and that's probably what's certainly helped us to this point is we treat it like our primary business. You know, we really care about the quality of your food. We care that you get it hot, we care that it's on time, we care that the driver delivered it with courtesy. And if you ask them not to ring on your doorbell because your kid's sleeping, they don't do that. Um, you know, those things are important focuses for us.

SPEAKER_01 7:07

That that's really interesting because um I feel like the I guess the opposite of what you're explaining is doing a well is really some of the bad experiences, at least that I know I've had uh like with ordering food on like uh an Uber Eats or a DoorDash. Um and uh the most recent example was actually uh I think w a a week or two ago. Um there's a local uh we had friends from from out of town staying with us, uh uh husband, wife, and uh and their eight-year-old. Um and so, and we're all gonna be working from home the next day uh for uh for the majority of the day. And so I was like, this is a great this is a great excuse for me to uh to order at this donut place that's just down the road uh that I know offers delivery through Uber Eats. Uh so order everyone some donuts and coffee and stuff uh for breakfast, and it means that I get to eat donuts on a weekday. And when and and Uber Eats, yeah. It was like huge win here. Uh I'm gonna take this opportunity, and then so did it. And um I think we ordered ordered like a a dozen, dozen donuts, various different, you know, different types, and then they they arrived, but only only six of them. So there was like a box missing. And so then I'm trying to call the delivery driver. Doesn't work. I'm trying to call the donut shop. No one's answering. I'm trying to message through um you know Uberet's support, and the only option I'm getting is uh to get a refund. I'm like, I don't want a refund, like I just I just want I just want the the other six donuts because um you know there's five of us here and six donuts, and I know that I would like to eat more than one and one fifth of a donut. Uh and there was there was no option. Then finally, you know, the delivery driver called back. He was really un you know, he was he was empathetic to it, and he was like, Let me call the donut place and see if they left out a box. And he's like, I hate it. And this was I think this was telling. He said, I hate it. Uh whenever I go there, they always they always mess something up. Um he said, I'll call you back, and never heard back, uh, and um and never got the other sex. I don't know where they went. But I feel like that is it's you know, some of the examples you just gave. Uh, you know, like my my favorite uh you know delivery for any food is is ice cream. Um and I now I know which places I'm gonna get ice cream that's still gonna be ice cream and not a milkshake when it arrives. Um even though I'd rather get it from the uh the other place, uh I know that that comes uh that comes as milk, you know. And it's so it's like and it's very hit or miss. Um and and to your other point of like trying to give that experience, like even the food itself is like it's completely different. Like it's uh then you know obviously it's not gonna come on a plate with garnished and all this, you know, everything that comes like that, but I mean it's it's it's like it's it's just like never the same or even remotely close to it. And so like it's it's um it's how do you yeah.

SPEAKER_00 10:58

So I'll tell you, so how do we create the dishes that we know work, right? Um, at least what we did. We're smart, we decided, okay, deep fried food doesn't really travel well. So the last thing we want to do is offer a menu of deep fried food that inevitably is gonna lead to customer complaints. So, like one of our signature items are wings, except we smoke and grill our wings, right? So they're healthier, they're more unique, but also in travel, they don't get really soggy and all of a sudden you're biting into this like wet breading and then it's a not crispy wings. So, like we do that with all of our food, right? We menu test, we throw it into a bag, we let it sit there for 30 minutes. Like, is this still good? Does it deteriorate? So bulls have been very successful for us because you know, they work when they're really hot and they also work well when they're like down to room temperature. Um, you know, there are certain dishes that we tried that we thought would be great and they end up not great. And we, you know, they get pulled from the menu. Um, so I think being very, very thoughtful about what you do offer, uh, knowing that it needs to travel, it might get banged around in a bag, it might be delivered alongside three other people's foods, um, that has to be part of your menu design. And that's why I say you can't go into it and just think, I run a restaurant, I'm gonna turn on delivery and offer the exact same menu, same prices, same quantities, same everything. It's just not apples to apples. Uh, you're you're not gonna get a good experience. Um, and to your your point on your poor uh Uber Eats delivery, right? These poor drivers sometimes get caught in the middle, right? They work for Uber, but they're independent contractors, so they don't really work for Uber. They don't work for the restaurant, and yet this guy called you back just because he cared, but it's not really his responsibility.

SPEAKER_01 12:52

Right.

SPEAKER_00 12:53

Uber doesn't care. They just want to get to a resolution. They'll throw you through loops, so they'd rather give you five bucks or a refund because the refund's coming out of the restaurant's pocket. They don't want to solve anybody's problem. So, like the incentives are never aligned when you order from a marketplace, right? Because just by nature, you can't make the customer happy, the restaurant happy, and you as a platform happy. So uh ordering direct, making sure restaurants have a direct way to order, I think is always the default, should be the go-to. I wish we could educate more customers on the benefits of ordering direct, not just to keep money in their local community, but for these exact reasons, for support cases, for the resolution you actually want. What do you want? I want someone just to bring me the rest of my order. That's what I want, right? Like just make it right. Um, and we go out of our way to do that uh less frequently now than at the beginning, but we'll forget a sauce, right? We'll forget something. We'll have somebody call in. What do we do? Go drop it off, right? With a little extra something. Oh, so sorry, we forgot your ranch dressing. Here's ranch, and also here's a piece of our famous carrot cake, you're gonna love it on the house. So sorry. You know, so those are things that can never happen through DoorDash or through Uber, but that we can offer, you know, as a small business.

SPEAKER_01 14:03

Yeah. No, and that's I mean, I I think that's just the gesture in that is extremely powerful. Because obviously, like these are these are not like these are not real problems, right? Getting your sauce, you know, this this is, you know, not getting these six donuts is really if that's the biggest problem I face that day, then it's a pretty good day.

SPEAKER_00 14:25

Um you're you're underestimating, I believe, how petty the average customer can be. We we appreciate you, but there are we we will have people that we will forget addressing or something very small and they will swear us off forever. Like, I can't ever order from you again because you know we we missed an item one time out of the hundred times they ordered. Like, so you're you're a kind one. We love customers like you.

SPEAKER_01 14:49

Well, but I mean I would I would imagine that when that issue is brought up, you miss this sauce or whatever, and then you guys are going out of your way and you're rectifying it, and then you're going an extra step, you know, with the carrot cake example. It's like if I was in that camp, I feel like I would feel like I'd feel really good about that, and uh it's that's not gonna swear me off. Like I'm gonna be like, wow, uh honestly, I I think my experience overall could even knit out to be bitter. Not only did I get a slice of carrot cake I didn't pay for, but like, you know, like there's I think there's something yeah, there's something to when you know voicing something and having someone hear what you're saying and actually do something about it.

SPEAKER_00 15:40

Yes.

SPEAKER_01 15:41

There's something powerful to that, I think. And um and also to your point about the uh you know the restaurants and like uh it being better for them economically to deliver straight because of like I we we have uh clients uh that are in you know the the food industry and I've seen what these different platforms charge them to have their food delivered and it's crazy because I know the driver the driver's not getting shit. The restaurant is getting skimmed on what you know overall are already pretty like low margins to begin with in this industry as a like as a whole.

SPEAKER_00 16:38

Correct.

SPEAKER_01 16:39

That sometimes it's like it almost seems like it's it's uh it's offered just because it's for the benefit of just being able to to offer it and have more people I don't know, they find maybe that's how they find you and then they eventually do come in person uh to dine with you. But I mean it's why do you think that why why do you think most or at least a lot of restaurants go the route of that platform when it is more profitable, it sounds at least more profitable to to do it in-house?

SPEAKER_00 17:22

Yeah, convenience, right? Um, that's the easiest thing, is if I'm a independent restaurant owner and operator, and I'm cooking and I'm doing the food orders and I'm also HR and I'm also marketing and I'm doing all these things, do I have the time to manage a whole different piece of the business? Learn how to put the technology together, which isn't hard to do that on my own, or is it easier for me just to say yes to an Uber Eats rep and they do all the work and I see these sales and I see this volume, and I think, oh, okay, this works and it's doing well for me. Um, I think that's the most obvious and simplest conclusion, right? Is it's just easy to do that. Um, but what most of these people find out, they the bill comes and they're like, wait a minute. Now there's a refund on this, I'm paying 30% commission, I'm paying out this. You want me to run a promotion for visibility? Now I'm giving out a free item. Am I actually making any money off of my delivery? And the honest answer is a lot of restaurants aren't. A lot of restaurants are seeing top line revenue that never sniffs the bottom line. It never makes it there. So while your sales might go up, it's like a sugar high, right? It's it's inflated and you're not actually making money. And past that, you might actually be running your team ragged to fulfill all these extra orders, and you're not making any money off of it. And now maybe the people that are in your dining rooms, because your people are running ragged, maybe they're getting a worse experience. So now they're not coming back and dining with you anymore. So again, the the idea of intention and really thinking through these things, these are huge, huge decisions to make. They should be made with a plan, they should be made with a budget, just like any other business. But you really need to look at it like it's a separate business. It's not incremental. It's not, oh, well, this is that's what a rep will tell you, right? If I'm an Uber Eats rep, I'm gonna say, you're gonna get all this visibility. People that never knew you existed, they're gonna come back and visit your store. All your competitors are on here, we're gonna do all this than that for you. They don't care. They just want your revenue on the platform, right? They don't care if you succeed or not. So um, yes, a lot more thoughtful uh operators need to be out there seeing, like, how can I do this for myself? Um, and that's not to say that we don't play on the third-party apps. We do in some cases, but we control the rules of when we do that, right? What time, what menu we offer, how much more we charge on it, what the customer expectations need to be, um, what our partner expectations need to be from Uber Eats and DoorDash. So, again, like a lot of thought, intention, standard operating procedures need to go into all these pieces in order for it to be successful for you.

SPEAKER_01 20:09

So how you you just you touched on visibility. Um we've mostly been talking about restaurants who you know already operated and you know, have in-person dining uh as their primary that want to branch out into delivery and offer that. But so how does it work with ghost kitchen then where you built the business to be a ghost kitchen where you you can't dine in person there? And how do you if like if anyone wanted to follow that model, like especially when it comes to like um if they're gonna you know not use the you know those main platforms, at least primarily, how do you how do you build a brand then if there's not a brick and mortar for people to walk in front of and just to run into and come across?

SPEAKER_00 21:09

Yeah, great question. Um the answer is split, it's a little bit hybrid. Uh we did intentionally early on, because I did a lot of research, you know, a decade ago. We do have a brick and mortar presence. Um, we are in a visible location. Location still matters. Um, if you were a cloud kitchen or a ghost kitchen business that boomed during COVID, you're probably out of business now. You probably raised a lot of money, but you're out of business now because what they realized was their hypothesis was put these kitchens in the middle of nowhere where there's no rent, it's really cheap, it's industrial, and like you just make all this food and you sell it and you're great. Well, just like you said, that's a visibility problem. So what we did is we decided if we build ourselves a traditional brick and mortar, but we change the inside of the store to more reflect how we operate, then we don't need to be reliant on third parties and tons of digital ad spend where I'm competing with my ad dollars with Grubhub Anuberitz. So we do have that presence. Part of the success of our business is the ability for customers to pick up their own food. So we do a great takeout business. You know, text message communication when your order is ready. Again, feedback, uh, order ahead for weeks in advance. So we've kind of blended these worlds where I still believe location matters. You don't need to have the best of the best location, but visibility is still important because you're going to spend it one way or the other. And you can either spend it on your real estate, or you can end up spending two or three times as much on digital ads and trying to compete uh with the deepest pocketed companies in the world.

SPEAKER_01 22:55

Interesting. And so and when you touch on real estate as well, so is the ghost kitchen model, is it would you say it's primarily a technology opportunity, a real estate opportunity, or an operational restaurant opportunity, or really a mixture of all of them?

SPEAKER_00 23:21

A mixture. I would say it's a it's more a technological and operational opportunity. I think good real estate is still good real estate, and a lot of people made the wrong bets during COVID on like, well, it's all digital and you don't really need to be. No, that's not true, right? There is something for convenience and credibility, right? People pass your store, then they see you online. You're not just some random ghost kitchen that's maybe operating out of like a bodega that has a hundred menus and it's hasn't passed a health inspection in 15 years. Um, you know, so I I think from a tech standpoint, all of this exists. It's really as an operator, you have to rethink everything about how you operate because your goals are different, your costs are different. So, like a typical operator for a standard restaurant might say, My labor's 30%, my food cost is 30%, that's my prime cost, and I know where I make my money and X, Y, or Z. Me, I might say, My food cost needs to be at 25%, my labor needs to be at 25% because I know I'm gonna have a cost of delivery between the platforms and fulfillment that might be 8 to 10%. And that needs to be accounted for. So, like the way you come across your math and how you build a profitable operation is different, right? Your technology needs maybe more, but maybe you're saving a little bit on overhead, or you can figure out how to tighten up your labor because you know exactly what you need and you're working with tight SKUs, or you need to figure out, hey, my prices actually need to be higher, just baseline higher than if I was having a sit-down restaurant because I need to account for the commissions that these places that these companies are taking from me. Right? So all those things play into it, but you cannot have a traditional restaurant operator mindset and think that you're gonna succeed in off-premise digital.

SPEAKER_01 25:15

What's what's the in your opinion, what is the single most important? And I know there's multiple uh kind of skill or mindset.

SPEAKER_00 25:28

Am I allowed to curse on this?

SPEAKER_01 25:29

Absolutely. It's encouraged.

SPEAKER_00 25:32

Okay, great. Um, the most important thing is to give a fuck. And like, I know that sounds like dumb, but if you care, if you care that your customers are having a great experience, if you care that your employees are enjoying themselves working, if you just care about everything, that solves a lot of problems because every operation's different, every market's different, every strategy is a little bit different. There's not like one, you know, key thing I'd be like, oh, if you just did this, no, of course, right? Because everyone would do that one thing. I can't teach people how to care. Um, but if you truly care about your business and your customers and what you're doing, you're gonna get there. You just need to know that you don't know everything, seek out the best advice, seek out, you know, follow in people's footsteps, draft behind them, see what they're doing. Um, it's just giving a fuck. Like that's the simplest thing. You have to have employees that do the same, right? They need to care about your customers' experience. And what happens when they care? Guess what? Someone's double checking to make sure you got both boxes of donuts, right? Someone's double checking to make sure the ranch is in your bag. Someone's following up on the phone afterwards, being like, Wow, we made a mistake there. I should call this guy back and offer him free donuts, right? When nobody cares, you're just trying to get through the day or throw food in the bag, that's when you're you're on a road to nowhere.