GIG ECONOMY

Rapid growth continues for Austin app-based delivery service Favor

Posted May 9th, 2017

An Austin-based company says it has performed more than 5 million “Favors” for people across the state.

Favor, an app-based delivery service, says it hit the milestone this week.

The company's specialty is food delivery – and most of those deliveries came from restaurants in places such as Austin, College Station, Dallas, Fort Worth, Houston, Katy, San Marcos and The Woodlands. But the company also performs other services, such as a quick stop at a drug store or supermarket to pick up an item or two.

Favor got its start in June 2013, made its 1 millionth delivery in October 2015 and now, a year and a half later, says it has surpassed 5 million deliveries.

The company, which has 120 employees, says it is on track to help Texas businesses generate $100 million in sales this year.

“It’s anything and everything. It’s crazy to think how new this space still is,” said Keith Duncan, Favor’s senior vice president of sales and business development. “If you order right now – whatever you order – our average Austin delivery time is around 40 minutes.”

Duncan, who moved to Austin from New York several years ago, says he was initially surprised by the lack of delivery options in the Austin metro area. Favor, he says, has helped change that. Now restaurants and other businesses that had never offered delivery services before can partner with the company to help boost sales and reach new customers.

In Austin, Favor says it has delivered enough pizzas, for instance, to feed every University of Texas student up to 10 times and enough barbecue to equal seven times the combined weight of the school’s football team. The most popular dishes delivered citywide are tacos for breakfast and lunch, sushi for dinner and burgers late at night.

“Everything you can do to have a competitive advantage these days is important,” Duncan said. “We’re having a really big impact on these businesses. Their sales are growing significantly. We love hearing their stories.”

One of those success stories, according to Duncan, is Tyson’s Tacos, at 4905 Airport Blvd. in Central Austin. Right off the bat, Favor accounted for 3 percent to 4 percent of sales and that number has steadily grown. Tyson Blankemeyer, the taco stand’s owner, says he saw a monthly revenue increase of about 30 percent attributable to Favor in January and February, with an increase of 30 percent on top of that in March and another 30 percent increase in April.

“The hard work we put in the past few years has been accelerated with Favor,” Blankemeyer said. “Our location went from being a little-known Austin gem to a can’t-miss place.”

Tyson’s Tacos sells food from a walk-up window, Blankemeyer said, so it used to close when bad weather rolled into town. But now that it utilizes Favor’s team of runners to make deliveries, the shop is open around the clock.

The Favor partnership has been so successful that the restaurant stopped working with two competing services, Postmates and DoorDash.

“We are approaching max kitchen capacity on most weekends, so it is important to work with partners that have dedicated account managers and who take pride in representing your business the right way,” Blankemeyer said.

Blankemeyer said he intends to use some of the new revenue Favor has steered his way to make some long-desired capital improvements to the business.

Chi’lantro, a growing Austin-based restaurant chain serving Korean-Mexican fusion dishes, is also relying on Favor. During one targeted campaign that offered $2 tacos on a recent Tuesday, for instance, owner Jae Kim said his location in the South Shore development in Southeast Austin saw an “incredible” 250 percent increase in sales compared to a typical Tuesday.

“We love working with Favor because we know they transfer our core value of great customer service throughout their platform,” said Kim, whose business was recently featured on ABC’s hit “Shark Tank” program. “Delivery, especially on-demand, continues to become a larger part of the restaurant business and we’re embracing it as a way for our customers to easily get our food when and where they want.”

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