Operational Update

RNS Number : 0982S

BigDish PLC

06 July 2020

 

BigDish Plc

( " BigDish " or the " Company")

Operational Update

BigDish Plc (LON: DISH), a food technology company that operates a yield management platform for restaurants, is pleased to announce an acceleration in the development of its strategy and to provide an operational update.

Highlights:

• Acceleration of corporate strategy to adapt to a post pandemic environment

• Building a Super App - many apps within an umbrella app, as a complete dining solution

• Launching BigDish-to-GO as a cost efficient alternative to existing delivery platforms

• New Reservation System to effectively manage physical distancing

• Moving from a transactional to a Software-as-a-Service ("SaaS") business model ​

• Technology partnership with Wia Technologies that offer smart building solutions including space utilisation monitoring

The pandemic has caused significant disruption to the hospitality industry.  Over the past several months the Company has been developing its strategy in preparing for what the future of the restaurant industry will look like and how best to respond to the needs of restaurants and consumers.  The Company recognises that the pandemic has also accelerated certain consumer trends and as such has been proactively upgrading its technology platform in order to address the wider needs of restaurants and consumers. 

Today, the Company announces that it will progress beyond being solely a dynamic pricing reservations platform to becoming a complete dining solution for restaurants and consumers.

The development in strategy can be categorised in key areas that are highlighted below.

Business Model

Prior to the pandemic the Company operated a transactional business model which is a typical model adopted by consumer focused platforms known as aggregators.  Aggregators typically require significant marketing budgets in order to build up a large user base.  Both the customer relationship and the data are typically owned by the aggregator platform.

BigDish will migrate from a transactional business model to a Software-as-aService (SaaS) model. 

A SaaS model is fundamentally different from a transactional or aggregator model in that it hands back control of the business to the restaurant. 

The key advantages for a restaurant are:

• No commissions or transactions fees but rather a fixed monthly fee;

• The merchant owns the customer relationship;

• The merchant owns the data;

• Lower customer acquisition costs as the merchant has greater incentive to use the platform to manage and promote to their  existing customer base as well attract new customers;

• Complete flexibility as to how they engage with their customer base.

The Company notes that there is a growing resistance from restaurants to transnational models most notably in food delivery where restaurants are charged commissions of up to 35% of the total customer order and that new business models are springing up in the food tech space that challenge and seek to disrupt these models. 

BigDish has identified some initial new features that represent the beginning of a complete overhaul of its technology platform. These initial new features will be rolled out progressively during July in beta.  Following the beta launch the Company will continue to build out these features with additional functionality over the course of the year.  The Company believes that developing what is known as a Super App, which is many apps within an umbrella app, will provide more value to both restaurants and consumers.

New Features

BigDish-to-GO

Off-premise dining, most notably food delivery, has grown exponentially during the pandemic. The Company expects this trend to continue.  The beta version of BigDish-to-GO is expected to go live around 31 July 2020.  BigDish-to-GO will enable restaurant customers to order food for delivery or pick up via the BigDish app or via a white label solution from the restaurants own website.  BigDish-to-GO will provide a cost effective delivery channel for restaurants that can sit alongside other delivery channels that a restaurant may use.

As part of the SaaS model, BigDIsh-to-GO will be available to restaurants with no commissions or transaction fees charged to restaurants.  The beta version will initially be available to restaurants that have their own delivery capability.  The Company has also started discussions with a view to integrate with several last mile delivery partners. This will provide partner restaurants with more options for the last mile delivery.  The Company will update the market in due course as this develops further.

BigDish will not be hiring its own fleet of drivers and the last mile will be managed by the restaurants own drivers and also in the near future through various technology integrations with last mile delivery partners all from within the BigDish app.  Last mile delivery companies do not typically charge commissions but rather the delivery charge is based upon distance.  Restaurants will have complete flexibility as to who pays the last mile cost of delivery, whether it be the consumer, the restaurant or shared in some way. 

The Manchester team are in the process of pre-signing restaurants to BigDish-to-GO that have their own delivery capability.  Thus far, this has been well received by current restaurant partners.

BigDish will also be rolling out payment functionality that will enable the restaurant to receive payouts on the same day as opposed to once or twice per month that other delivery platforms offer.

The Company expects that more last mile delivery companies will spring up post pandemic and that SaaS delivery models will be well positioned to disrupt and create more cost effective delivery solutions for restaurants rather than having to pay large commissions to aggregators.  For every order that a restaurant receives through BigDish or via its own website ( with the order page powered by BigDish) it will generate substantial savings compared to a commission model.  There are still many restaurants that have not adopted delivery due to concerns that commission based models take too much of the profit margin and the Company expects that BigDish-to-GO, as part of a SaaS model, will gain traction with restaurants. 

This payment functionality will later be made available for in-restaurant dining to enable a contactless dining experience so that customers can order and pay their bill at the table via the BigDish app.

Reservation Platform

BigDish will now offer a more complete reservation platform that will enable consumers to book tables at restaurants up to 30 days in advance.  Dynamic Pricing will still be available to restaurants but there will be complete flexibility in that restaurants can choose what offers (if any) that they may want to make available and when they wish to do so.

The Company believes by providing more flexibility in its reservation platform that it will assist restaurants in creating a safer dining environment for its customers with more effective capacity management that promotes physical distancing.

The reservation platform will incur no cover fees (fees per diner seated) and will be incorporated into the SaaS package.  This reservation technology will at a later date be plugged into the restaurants own website so that reservations can be made from the restaurant's own website. 

Technology Strategy

The migration to a SaaS model means that BigDish will double down on its technology strategy.  The new features will initially be beta versions and over the remainder of the year further enhancements will be rolled out.  The key value proposition for the BigDish SaaS model is seeking to generate more value for restaurants and more reasons for consumers to use the BigDish app.  The new functionally announced today is just the beginning of a complete overhaul of the BigDish technology platform and the Company will update the market as new functionality is developed and progressively rolled out.

The pricing strategy of the SaaS model has yet to be determined, as this will be partly determined by the functionality of the platform as it evolves.  Whilst there is much uncertainty across the retail sector brought about by the pandemic, there are also significant new opportunities and technology adoption is driving many of these.

United Kingdom Strategy

Prior to the Covid-19 pandemic, there were approximately 650 restaurants live on the BigDish platform.  The platform enabled restaurants to use dynamic pricing in order to attract diners to their restaurants at times of their choosing.  Consumers could book tables 48 hours in advance that had either a 25% off, 50% off, or 2-4-1 discount offer which was applied to the food bill.

In preparation for restaurants reopening, the company recently began to bring some of its Manchester employees back to work from furlough.  Restaurants were permitted to open on 4 July 2020.  Across the UK based on early feedback the Company has received, is that some restaurants have adopted a more cautious wait and see approach in terms of when they will reopen and have not reopened on 4 July 2020.  The Company expects that many restaurants will keep staff on furlough throughout the month of July and will start reopening progressively.

Early feedback from restaurant partners that have been reached thus far report a willingness to continue to use the BigDish platform and as such the Company expects to reactivate partner restaurants progressively as and when they are ready to reopen over the next few months.  The Company notes that feedback from restaurants based on early discussions with regards to BigDish-to-GO has been particularly positive.

The key plans for the Manchester team over the next three months is to bring about the return of as many of the current restaurant partners as possible to the platform as and when they reopen and for them to adopt the new features available in addition to acquiring new restaurant partners. 

Over the past three months restaurants have been displayed in the BigDish app as having 'No Seats Available'.  The Company will now change this display from today and move all restaurants to 'invisible mode' within the app until they are reactivated or lost from the platform.  The Company expects to have a clearer understanding with regards to restaurant retention and new restaurant acquisition in September this year and will update the market in due course.

Prior to the pandemic the restaurant acquisition strategy was focused all across the United Kingdom.  It is likely that by migrating to a SaaS model that the expansion strategy within the United Kingdom will become more focused.

Given the advantages of a SaaS business model, the potential for cost effective international expansion in the future is far greater than that of the previous business model. 

Technology Partnership

When restaurants reopen, safe dining and physical distancing, will be important for restaurants in order to give confidence to their customers.  BigDish has entered into a partnership with Wia Technologies Ltd ("Wia") where BigDish will introduce Wia to restaurants across the United Kingdom.  This is an exciting partnership in that it ensures the Company stays well ahead of events in order to support restaurants as they adapt to regulations with regards to physical distancing. 

Wia is a software and electronics company based in Dublin that offers end-to-end services for a range of smart building solutions including people counting and space utilisation monitoring. The suite of tools offered by Wia forms an ideal solution for businesses, including restaurants, now facing the difficult task of trying to allow their employees and customers to return. By using GDPR compliant people counting sensors, the Wia solution can monitor capacity in real-time and provide information to ensure physical distancing and appropriate capacities are maintained.  Wia ' s compliance-focused analytics also help businesses identify when certain key metrics fall below the limits set within definable guidelines, including those set by the governments regarding Covid-19. Wia has secured investment from the Sure Valley Ventures and Enterprise Ireland High Potential Startup Fund.

Aidan Bishop, Founding Director, commented:

"It is great news that restaurants are starting to reopen and BigDish is getting back to business in the UK.  Over the past few months our tech team has been working very hard in Manila in building what is the beginnings of a Super App, which enables BigDish to offer so much more value to restaurants and consumers alike.  I would like to thank the team who amidst so much uncertainty have worked tirelessly and have been willing to sacrifice their salary for the advancement of the business."

"At the onset of the pandemic the outlook was rather bleak for the future of the hospitality industry.  Whilst there is still much uncertainty, which I would expect to continue in the short to medium term, I firmly believe that the restaurant industry will survive albeit the landscape will look rather different.  The restaurant of the future will have to cater for both on and off premise dining and the pace of technology adoption will continue to rise which in turn will accelerate innovation.  BigDish is building a technology platform in readiness for the restaurant of the future."

"Launching a beta version of BigDish-to-GO is an exciting step forward for BigDish and has been well received based on early feedback from our restaurant partners.  There will be significant enhancements made to our delivery platform that will be rolled out over the remainder of 2020."

"I would like to thank both the BigDish team and all our shareholders who have maintained their belief in the Company.  I firmly believe that the course we have set today will build a strong foundation for the future of the Company."

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE MARKET ABUSE REGULATION EU 596/2014 ("MAR")

Enquiries:

Zak Mir, Digital Communications Officer, BigDish	[phone]
	[e-mail]
Jonathan Morley-Kirk, Non-Executive Chairman	[e-mail]

 

END

 

 

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