By Bhavin Asher, CTO and Founder of GRUBBRR, a leader in self-driving technology.
These days, it seems that discussions of digitalization and automation are ubiquitous in the restaurant industry, especially in quick service restaurants (QSRs). However, it has not always been so. In the past, restaurants have been notoriously lagging behind when it comes to implementing automation, and more specifically, self-ordering technology. While other industries such as banking and travel industries have started automating their routine processes, the restaurant industry has continued to send cheap labor to its troubles.
As a result, other industries have seen innovation spurred by a plethora of startups, many backed by venture capitalists and private equity firms who are constantly shaping new realities for their respective industries. In the restaurant industry, this has been slow and rare to see. In the foodservice technology vertical, the adoption of new technologies has been slow and subject to criticism, inhibiting innovation.
However, that all changed with the Covid-19 pandemic. In March 2020, as businesses across the country were forced to change their operations or shut down, restaurants were left with an ultimatum: innovate, automate, or get left behind. Labor shortages, rising federal minimum wages, and growing pressure to meet consumers at the point of sale have restaurants looking for a solution, with self-ordering technology emerging as the clear answer.
In a typical QSR today, there are six to seven disparate pieces of technology that are siled (not in communication with each other), making restaurant operations cumbersome. To avoid this, restaurants should look for solutions that are part of a platform or ecosystem and can easily integrate with other systems. Over the past five to seven years, several companies have started to come up with innovative front of house, back of house, and digital control solutions to solve this problem.
According to Harry Patz, Senior Vice President and General Manager of Samsung’s Display Division, “…business models [were] reinvented on the fly during the pandemic, as innovation cycles have gone from years to months or even weeks. Our retail, QSR and hospitality customers were looking for ways to continue their business while maintaining social distancing, and needed solutions such as digital curbside signage and kiosk technology for pickup and contactless transactions. These customers then realized significant savings during a critical period, and so we see many future opportunities for kiosk technology in QSR takeout retail and hospitality operations.
With the increasingly digital adoption of restaurants and investments, restaurant tech startups are springing up and innovating at a rate never seen before. From burger-turning robots to ADA-compliant kiosks, new technologies are heating up the restaurant industry at the nation’s top QSRs and improving the experience for operators and consumers.
A microcosm of the pandemic, consumers now want to be able to interact with their favorite businesses through different touchpoints. The customer now fully dictates how their journey and interaction with your brand is. They want to order, taste and receive their food where they want, when they want and how they want. In restaurants, this is called an omnichannel meal. In the omnichannel model, the customer orders as they wish and receives real-time updates on their order until it is picked up or delivered.
In other words, consumers want to be met where they are, whether that’s a kiosk, online device, or mobile device. Before the pandemic, this omnichannel presence was virtually absent from the restaurant industry. Post-pandemic, restaurants needed this technology to simplify their operations, use data and reports to make informed decisions to scale their business and reduce costs. Self-ordering technology also allows restaurateurs to use marketing to curate a personalized customer journey, similar to that offered by Amazon.
For large restaurant businesses, digital ordering channels like kiosks and mobile ordering help them scale faster, reduce costs, and increase results through upselling, which is critical to their growth. Today, companies in this space are innovating using the latest technologies, shifting from traditional architectures to cloud-based architectures, which reduce operational costs and required support resources.
This type of technology allows restaurants to think outside the box, as evidenced by the recent increase in ghost/dark kitchens. Ghost Kitchens do not have a physical storefront and do not offer on-site catering. Instead, they operate primarily by delivery, sometimes also offering take-out or drive-thru pickup. Ghost kitchens are unique in that, unlike many restaurants, they are inherently state of the art. For example, the focus on mobile and online ordering means that the restaurant can also be easily enhanced with innovative kitchen display technology, and apps allow them to track orders, allowing them to try new avenues.
The rapid adoption of self-ordering technology within the restaurant industry is driving innovation and key to the sustainability of the industry. The next phase of innovation lies in operations and decision-making based on AI and machine learning. Using digital intelligence and data collected with the implementation of these technologies, AI will be able to predict workforce forecasts, sales forecasts and consumer choices at the kiosk with facial recognition or just their phone number. Collecting, aggregating, and analyzing this data will make the restaurant experience personalized for every customer, and from there, the possibilities are endless.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.