Step 11 · Prepare
Public chapterBusiness model
Position
SwiftBite will retain the capped merchant commission and a separately disclosed consumer software fee; delivery charges and tips belong entirely to couriers. Launch remains conditional on verified courier earnings, positive order contribution, and a funded operating budget. The founder’s personal runway must not be presented as sufficient financing for city operations.
Business Model Canvas
| Canvas block | SwiftBite operating commitment |
|---|---|
| Customer segments | Recruit independent restaurants within the downtown core and adjacent neighbourhoods, prioritising owners with established delivery demand and direct founder relationships. Serve consumers ordering within the launch boundary. Onboard local, independently contracted couriers using their own vehicles, subject to classification review. |
| Value propositions | Merchants receive capped, auditable fees without exclusivity. Consumers see the complete payable amount before confirming. Couriers receive published delivery compensation, retain delivery charges and tips, and receive any required earnings top-up from SwiftBite’s share. |
| Channels | The founder conducts owner visits and signs merchant agreements directly. Participating restaurants distribute counter cards, bag inserts, and approved links to SwiftBite checkout. Consumer acquisition begins through merchant-owned channels rather than subsidised citywide advertising. |
| Customer relationships | The founder owns merchant onboarding and weekly exception reviews. A contracted dispatch lead handles live-order support. Refund requests receive a documented decision with responsibility allocated between merchant, courier, and platform; customers are not sent between parties. |
| Revenue streams | SwiftBite earns the merchant commission and consumer software fee shown below. No merchant subscription, compulsory promotion purchase, priority-placement charge, or undisclosed processing surcharge applies at launch. |
| Key activities | Recruit merchants, verify menu accuracy, maintain courier availability, reconcile settlement balances, resolve delivery exceptions, and review contribution by merchant and delivery window. Pause windows that cannot meet earnings and contribution requirements simultaneously. |
| Key resources | Founder relationships, signed merchant agreements, courier coverage commitments, licensed checkout and routing software, payment reconciliation records, and city-specific operating procedures. SwiftBite owns its merchant and transaction records and requires export access. |
| Key partners | Select a white-label provider through a contractual acceptance test. Obtain Stripe Connect and alternative marketplace-processing quotes without assuming underwriting approval. Retain local employment counsel, a commercial insurance broker, and a bookkeeper experienced in marketplace settlements. |
| Cost structure | SwiftBite bears courier top-ups, payment processing, licensed software charges, platform-attributable refunds, insurance, dispatch support, and customer acquisition. Merchant caps and courier earnings commitments remain unchanged when these costs increase. |
Settlement and contract schedule
| Flow or term | Contract instruction |
|---|---|
| Merchant commission | Charge 12% of the food-and-beverage subtotal after merchant-authorised discounts; exclude tax, delivery, software fees, and tips. No other mandatory merchant charge. |
| Consumer charges | Display $3.99 delivery and a $0.99 software fee (estimate; proposed launch price) separately before payment. Prohibit preselected tips, hidden checkout additions, and surge charges at launch. |
| Consumer payment | Collect the cart subtotal, applicable tax, delivery charge, software fee, and voluntary tip through the approved marketplace processor. Use the bookkeeper’s jurisdiction-specific tax configuration. |
| Merchant entitlement | Credit 88% of the eligible subtotal (estimate; derived), plus merchant-payable tax. Settle weekly after reconciliation; disclose processor-imposed reserves before signing. |
| Courier entitlement | Pass through 100% of delivery charges and tips. Publish $6.00 per completed delivery (estimate), comprising the delivery charge plus a SwiftBite-funded supplement. Pay weekly. |
| Earnings protection | Supplement courier pay whenever delivery compensation, excluding tips, falls below the applicable minimum-wage equivalent over logged platform-committed time. Include dispatch waiting and required repositioning; counsel must approve the time definition. |
| Refunds and cancellations | Reverse commission on refunded merchandise. Charge merchants only for documented merchant-attributable errors under their agreement. SwiftBite funds platform failures and any courier cancellation compensation required by the published schedule. |
| Accounting controls | Record restaurant, courier, tip, and tax obligations separately from platform revenue. Reconcile processor receipts, order records, and payout liabilities daily; prohibit treating unpaid settlements as operating cash. |
The software contract must support itemised receipts, configurable commissions, courier supplements, refunds, and downloadable settlement ledgers. The founder approves commercial terms; the bookkeeper signs off reconciliation; counsel approves classification, tax responsibilities, and courier terms before live trading.
The numbers
| Item | Figure | Basis |
|---|---|---|
| Capital and personal reserve | $85,000 capital; $67,200 reserve (estimate); $17,800 remaining (estimate) | Reserve calculated from supplied $4,800 monthly personal burn over 14 months; remaining cash excludes startup commitments. |
| Representative order | $35 cart (estimate); $39.98 checkout before tax/tip (estimate) | Cart plus supplied delivery fee and proposed software fee. |
| Platform revenue | $5.19/order (estimate) | Merchant commission of $4.20 (estimate), plus software fee. |
| Courier compensation | $6.00/order (estimate); $2.01 platform supplement (estimate) | Delivery charge passes through in full. |
| Earnings benchmark | $18/hour and 3 deliveries/hour (estimates) | Planning assumptions only; replace with local legal floor and observed committed time. |
| Processing | 2.9% plus $0.30 (estimate); $1.46/order (estimate) | Assumed charge on illustrative checkout; tax and tips increase processing expense. |
| Other variable costs | Software $0.35; refund reserve $0.30; insurance allocation $0.20/order (estimates) | Unquoted planning allowances. |
| Contribution | $0.87/order (estimate) | Revenue less courier supplement and listed variable costs, rounded. |
| City fixed overhead | $8,500/month (estimate) | Dispatch, support, fixed licensing, marketing, and administration; excludes founder personal spending. |
| Target-volume result | 50 merchants; 300 orders/day by month 12; approximately $665 monthly city loss (estimate) | Supplied targets; 30-day month (estimate), using unrounded contribution. |
| City break-even | Approximately 326 orders/day (estimate) | Fixed overhead divided by contribution across a 30-day month (estimate); target deadline remains month 18. |
| Density downside | 2 deliveries/hour; $9 courier pay/order; negative $2.13 contribution/order (estimates) | Same hourly benchmark; SwiftBite funds the additional earnings protection. |
Decisions and trade-offs
| Decision | Binding consequence |
|---|---|
| Retain the consumer software fee provisionally | Validate willingness to pay before committing acquisition spend; never conceal it inside delivery pricing. |
| Protect courier earnings before expansion | Reduce available ordering windows rather than transfer low-density losses to couriers. |
| License instead of build | Reject vendors lacking settlement exports or configurable supplements, even if their headline subscription is lower. |
| Separate personal and business funding | Do not approve a full-city cost base against the remaining operating cash. Secure a funded ramp budget first. |
Do this next
| Action | By when | What proves it worked |
|---|---|---|
| Founder obtains processor, software, and insurance quotes | Before vendor signature | Written costs replace planning allowances. |
| Counsel validates courier and tax arrangements | Before recruitment | Approved contracts and earnings-time policy. |
| Dispatch lead runs instrumented delivery trials | Before public checkout | Committed-time logs substantiate positive contribution after top-ups. |
| Founder and bookkeeper build the cash ramp | Before launch authorisation | Monthly cash stays positive through funded milestones. |
| Founder reviews checkout conversion in the licensed dashboard | Weekly after launch | Fee exposure, abandonment, and completed-order contribution are reported by channel; industry benchmarks remain secondary. |
Risks in your situation
Thin contribution leaves little protection against larger tax-inclusive processing bills, waiting time, or refunds. Contractor reclassification could invalidate the courier cost structure. The operating cash available after the personal reserve does not establish a funded path to break-even; expansion must remain conditional rather than assumed.
Evidence gate
- ☐ Signed agreements preserve the merchant cap and complete delivery-charge pass-through.
- ☐ Local counsel approves courier status, earnings measurement, and tax allocation.
- ☐ Trial settlements reconcile without unexplained balances.
- ☐ Observed orders remain contribution-positive after all supplements and variable costs.
- ☐ Checkout evidence supports the disclosed software fee.
- ☐ A funded cash-flow schedule covers the ramp without borrowing merchant or courier balances.
Illustrative figures · validate before actingNext: Business plan