“I’ve used DoorDash and Grubhub and Uber (Eats), but they all charge exorbitant prices, usually around 30% of the cost of the order,” said Robert Malm, owner of Hook & Lime.
Dalamar McTizic leaves Hook & Lime to deliver an order Tuesday. Hook & Lime is part of a new local restaurant co-op delivery service created to bypass the steep fees of major third-party food delivery services. The service, called Omaha LoCo, started Monday.
OMAHA — The owner of Omaha’s Hook & Lime restaurant looks forward to the day he can quit relying on a nationwide food delivery company.
“I’ve used DoorDash and Grubhub and Uber (Eats), but they all charge exorbitant prices, usually around 30% of the cost of the order,” said Robert Malm, whose Mexican eatery has been open in north downtown for about four years. “Restaurants are a small-margin business, and 30% is really steep.”
Malm hopes he won’t have to use third-party delivery services much longer. He recently joined Omaha LoCo, a new locally owned delivery co-op, and when the kinks are worked out and it’s fully operational, he’ll bid farewell to his current vendor, he says.
For $2,500, restaurants can become members of the cooperative, which charges commissions between 13% and 15%. Co-op members also share Omaha LoCo’s profits.
The service started Monday and was online from 10 a.m. to 10 p.m. Only two restaurants were up and running on the app that day — Hook & Lime (closed on Mondays) and California Tacos & More.
But the service got its first four orders, and that was good, said Clay Seaman, Omaha LoCo’s general manager.
“It was a super-smooth slow rollout,” he said.
More choices will be available soon. About 25 restaurants are on board so far, but there’s a lag between when agreements are reached and when all the technology is in place.
More restaurants are interested. Since the coronavirus pandemic began and takeout operations became crucial, local owners have been increasingly frustrated with the expenses involved in third-party delivery.
Many describe it as a necessary evil, finding it economically and logistically untenable to coordinate delivery in-house.
“Managing it is very difficult work, not the kind of thing most restaurants do normally,” said Brian O’Malley, a co-op member and associate dean of culinary, hospitality and horticulture for Metropolitan Community College.
Restaurants often pass on the cost of the third-party services to the consumer. A customer who recently wanted takeout checked one Omaha eatery’s online and dine-in menus, and the prices for most items on the delivery menu were several dollars more.
Blane Hunter, owner of Porky Butts BBQ, said he considered setting up his own delivery operation but issues such as workforce availability and insurance liability were too daunting, especially for a relatively new restaurateur.
“I’d love to do it sometime,” he said, “because I don’t like the big guys.”
In Lincoln, the City Council voted on Monday to cap the fees that third-party delivery companies such as DoorDash, Grubhub and Uber Eats charge restaurants to no more than 15% of the purchase price.
That ordinance, however, only applies while the city’s pandemic emergency lasts.
In Omaha, owners of Oasis Falafel floated the co-op delivery idea because they participated in a similar endeavor in Iowa City, Iowa.
In fact, said Seaman, Omaha LoCo is a franchise of the Iowa City co-op, called Chomp. Others using the app are in Knoxville, Tennessee, and Richmond, Virginia.
Omaha LoCo wants to limit membership to 60 to begin with, Seaman said. But any restaurant in the area can be included at rates slightly higher than members — they will pay about 18% to 20% commission on each order.
Non-members will get all the advantages except a share of the profits and the ability to weigh in on company decisions, Seaman said.
In addition to the economic benefits, locally owned and operated delivery services have an accessibility advantage over national companies, participants said.
Seaman said a live person will monitor LoCo activity every day from 10 a.m. until 10 p.m. If something is omitted from an order, they will make sure the item is delivered, even if it’s by a different driver.
Omaha LoCo, which has been in the works for several months, refined its delivery process when it administered a meals program funded by a $500,000 federal coronavirus stimulus grant from Douglas County in December.
It worked with area restaurants and pantries to provide 7,000 meals for food-insecure families.
“We got our feet wet big time,” Seaman said.
The December effort gave Omaha LoCo a stable of drivers to start the delivery business.
Hook & Lime was one of the restaurants that made the family meals, Malm said, and that’s what sold him on membership in LoCo.
“It was amazing. Struggling restaurants were getting money to help their operations and we were helping families that needed it,” he said. “It was a no-brainer to sign up after that.”
Participation also was a must for O’Malley, who had been watching Omaha chefs, restaurant owners and personnel despair over delivery while wrestling with a pandemic. Some, no doubt, are former Metro students.
“Restaurants were needing something that wasn’t causing as much harm as good,” O’Malley said. “Keeping restaurants alive is a critical part of having an awesome city to live in. They are an important part of the social fabric, cultural fabric and economic fabric. That’s why it was important for me to be a part of this.”
LOST RESTAURANTS OF LINCOLN:
King’s Food Host
Diners placed orders by phone from their tables at King’s Food Host, 1315 N St. This file photo is from 1958. The restaurant, which began as a State Fair booth and grew to 140 locations in the U.S. and Canada, closed its last location in Lincoln, at 923 South St., in 2001.
The Knolls County Club
The Knolls County Club opened its golf course in 1963 and the restaurant three years later. The club was private, but the restaurant was open to the public. It closed in 2015.
Tony and Luigi’s
Chef Dennis Barratt (from left), assistant Lewis Prue and manager Dave Harrison at Tony and Luigi’s in a 1982 photo. The restaurant was founded in 1945 and grossed $6.50 on its first day. It closed in 1993.
P.O. Pears
Scott Mercer (left) was helped by Bob Scura and Kurt Cameron of Grand American Fare chain in assembling décor for P.O. Pears, popular with college students in the 1980s and ’90s. It closed in 2008.
Crane River Brewpub and Café
Clint and Shelly Burge hang a 26½-foot-long quilt on the north wall of Crane River Brewpub and Café in downtown Lincoln in December 1992. Shelly Burge worked on the quilt for 319 hours. It depicts sandhill cranes on the banks of the Platte River. The restaurant closed in 2003.
Acme Chili Grill
Acme Chili Grill at 14th and O streets, shown the year it closed in 1963, served enough chili during its 54 years “to float the state Capitol,” according to the Lincoln Star.
K’s Restaurant
Paul Bruner entertains in 1979 in the Simba Room during dinner hour at K’s Restaurant, which was in the Piedmont Shopping Center on South Cotner Boulevard. Lions were a part of the restaurant’s décor. It closed in the early 2000s.
Tony Domino’s Italian Village
This 1960 file photo of Tony Domino’s Italian Village restaurant at 5730 O St. was taken when the Legionnaire Club announced it was buying the building. The Italian Village, founded in 1936 at the same location, was rebuilt in late 1951 after a May fire destroyed everything but the building’s brick walls. Smoke from that early morning fire killed the restaurant’s custodian as he slept in the boiler room.
Arturo’s
In 1979, the Taco Hut, 233 N. 11th St., officially changed its name to Arturo’s. The Mexican restaurant was forced to move in 1987 when the city condemned it with other businesses to make way for development that didn’t happen.
Bishop Buffet
Bishop Cafeteria, which opened in Lincoln in 1956 at 1325 P St., moved into Gateway Shopping Center in 1972 and was renamed Bishop Buffet, shown here in 1985. It closed in 1996.
Tastee Inn and Out
Tastee Inn and Out, 1530 N. 48th St., opened in 1949 and was known for its loose-meat sandwiches and onion chips. Shown here in 1982, the drive-in restaurant closed in 2014.
elizabeth.freeman@owh.com, 402-444-1267