Restaurant software company Tarro — formerly known as Wonders — just made a huge leap forward.
Its suite of solutions for independent restaurant owners had previously been scoped to in-house operations. Now, it’s headed out the doors — and to the doors of customers — with Tarro Delivery.
The solution manages phone orders as well as drivers — all at a lower cost than third-party delivery services for both the restaurant operator and the customer.
“The total addressable market is huge,” said Director of Product Nate Ren. “I believe we have a chance to triple the amount of business in the next 12 months.”
The Market for Tarro Delivery
As third-party food-delivery services have skyrocketed in popularity since the pandemic, restaurant operators often struggle to afford the commission rates — on average 30 percent — that these services charge, while the consumer also pays exorbitant surcharges, resulting in smaller and less frequent orders and, therefore, less revenue for the restaurant.
Research from Preoday revealed that 70 percent of consumers would rather place a direct order, preferring that their money go to the restaurant and not a third-party delivery service.
Still, many restaurant owners have avoided delivery altogether, citing the issues of high costs for third-party services, the hassle of hiring and retaining drivers — who are notoriously unreliable, expensive to train and difficult to manage — and the struggle of managing their routes to ensure food doesn’t get cold waiting for a driver to return.
As the Hulu show The Bear has taught us, running a restaurant is chaotic, and managing delivery services adds yet another layer of chaos. Tarro Delivery’s integration with Tarro Voice Ordering takes on the chaos that exists at the phones and with delivery, allowing the restaurant owner and their team to focus efforts on more high-impact areas, like the food.
How does it work? When a customer calls the restaurant, after just one ring the call automatically transfers to Tarro’s Voice Ordering Platform. A professionally trained agent, powered by AI, greets the customer and takes their order, along with their preference for pickup or delivery. Then, Tarro sends the receipt and order information to the restaurant, and, if the customer has chosen delivery, Tarro sends a driver to pick up the order and take it to the customer’s door.
“With Tarro Delivery, restaurants can complete more orders per day and reduce staffing costs — all with significantly fewer headaches,” Ren said, explaining that the solution took months of cross-functional work to develop.
“To achieve a great customer experience means a well-oiled and fast delivery experience that takes care of all corner cases,” he noted. “For example, what happens if a driver doesn’t want to go to the neighborhood and the restaurant owner already cooked the food? Or when a customer calls back to change the address, but the driver is already on the way to a different one? The product has to handle all of these scenarios.”
Motivated by “aggressive-yet-realistic” goals, Ren and his peers succeeded in bringing Tarro Delivery to life, signaling the start of an exciting chapter for the company as a whole. Read on to learn more about the creation and impact of Tarro’s new product and the first-principles culture that fueled its inception.
What Does Tarro Do?
Formerly known as Wonders, Tarro was founded in 2012 by Steve and Dennis Lin — who grew up working at their family’s restaurant — with the goal to create technology that helps independent restaurant owners make more money, cut costs and eliminate headaches. The company’s AI-powered platform helps restaurateurs handle food orders and deliveries and deliver personalized marketing campaigns.
What gave rise to Tarro Delivery, and what impact will it have on the company’s customers?
Many of our restaurants are pickup-only establishments. Without our product, these restaurants would turn down additional revenue when customers call in and ask for a delivery order.
“Without our product, these restaurants would turn down additional revenue when customers call in and ask for a delivery order.”
Even if restaurants have in-house drivers, they face problems whenever the driver is late, sick, overwhelmed or absent on short notice. In addition, the cost of a driver could be as high as $2,000-3,000 a month. Tarro Delivery takes away all of the headaches. We found product-market fit immediately and scaled to hundreds of restaurants within months.
What role did your team play in launching Tarro Delivery?
I oversee the Tarro Delivery product team. There are plenty of low-hanging fruits, and the total addressable market is huge — we have a chance to triple the amount of business in the next 12 months. It requires hard work from a great team of product managers, engineers, designers, customer success managers and sales representatives to achieve this goal. Along the way, we built technologies for driver dispatch, payments, receipts and alerts.
Science Meets Scrappiness
Ren credits Tarro’s culture, grounded in a scientific, non-assumptive approach, with playing a significant role in the successful launch of Tarro Delivery.
“I think Tarro has a strong work ethic and a leadership team that appreciates first-principles thinking rooted in data,” he said. But apart from that, he shared that the relatively small size of his team played as much of a role, enabling him and his peers to embrace the scrappiness that comes with operating in a startup.
What teams did you collaborate with in order to get Tarro Delivery across the finish line?
On a day-to-day basis, I work with product managers, engineers, designers, customer success managers, customer support and sales to get products shipping and momentum high. A lot of it comes down to clear documentation with product requirement documentation and product reviews. Weekly stakeholder meetings that were well organized with agenda items and blockers also played a crucial part.
What were some of the challenges your team faced through the development process?
Delivery technology is quite complicated under the hood. There are a lot of moving parts; the product has to enable the taking a customer’s order over the phone, the surfacing of food items, addresses, entries and payments, the sending of receipts and the dispatching of a driver at the right time based on supply. To achieve a great customer experience requires having a well-oiled and fast delivery experience that takes care of all corner cases.
For instance, what happens if a driver doesn’t want to go to a certain neighborhood and the restaurant owner already cooked the food? Or, what happens when a customer calls back to change the address, but the driver is already on the way to a different one? The product has to handle all of these scenarios.
How do you keep team members motivated throughout the creation of a solution like Tarro Delivery?
To keep the team motivated, I focus on gaining momentum, which can be accomplished in many ways. I aim to set clear key performance indicators that are aggressive yet grounded in realistic assumptions. I require well-written process requirements documents that are in-depth and take the guesswork out of the equation for the design and engineering teams. Lastly, I believe good product management just takes a ton of hours in the office; there’s no way around it.
