Embracing technology to respond to rapidly changing needs
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Contactless interaction with customers has become a necessity during the coronavirus pandemic, and the technology teams of many restaurant chains have been working hard to streamline guest visits and make the lives of their employees easier.
Three technology chiefs discussed their latest efforts with attendees of Restaurants Rise powered by MUFSO in a panel titled Touchless Tech: How Chains are Reimagining Technology with the use of Contactless Ordering and the Resurgence of QR Codes.
QR codes, a technology of a decade or so ago that had been falling into disuse before the pandemic, have become an important tool for many restaurants, including Tocaya Organica, a 16-unit “experiential fast-casual” chain serving Mexican food in California and Arizona that’s part of The Madera Group.
“We had to make sure that that experience carried over as much as possible,” as the chain began to experiment with moving away from counter service and toward letting customers order using QR codes at their table, according to Justin Keenen, Tocaya Organica’s director of information technology.
Guests can point their phones at the codes on each table, pull up the restaurant’s menu and order. Each table has its own QR code, so servers know where to bring the orders when they’re ready, and Keenen hired the tech company Thanx to build access to the chain’s loyalty program on top of the Olo ordering software, allowing guests to accrue and redeem points from their phone.
Keenen said about 80% of users surveyed said it was very easy to use. “It’s overwhelmingly positive feedback,” he said, adding that the technology would be introduced to a second location in late October.
El Pollo Loco, a fast-casual grilled chicken chain has around 480 locations, and now has geo-tagged curbside pickup at 95% of them, according to Andrew Rebhun, the chain’s vice president of digital.
Although curbside pickup had been planned for 2021, once the pandemic hit, Rebhun and teams for operations, training and finance worked to launch the service via El Pollo Loco’s app this summer, starting with around 20 restaurants, and then quickly expanding it.
“We had really good partnership across disciplines in the company,” Rebhun said. “It was a six-week rapid acceleration partnership… It was improbable, but we’re thrilled that we were able to bring it to the market, and the consumers were very pleased.”
Customers can opt in to GPS tracking, which alerts the restaurant as they drive up, allowing team members to bring the order right out to their car — there’s even an option to enter the type of car.
Guests that don’t opt in can simple push the “I’m here” button on the app, “and then the crew member will be out with a face mask and deliver the food,” Rebhun said.
Miso Robotics
Although named for its ability to flip burgers, White Castle is using the “robot on a rail” to work the fry station. It operates above the fryer, so it doesn’t get in the way of team members.
“It’s actually looking at the oil,” Carrol said. “There’s no more timers. It looks at the products, reads the products, cooks them, shakes them appropriately, cooking very consistently over and over again.”
Flippy works with a smart freezer by Computer Vison that portion-controls and schedules the items to be fried, as well as with a human team member.
“There are different timers, everything’s beeping, we’re asking [workers] to hold some stuff, but most of the things are cooked to order. It’s just a lot to take care of.”
With Flippy’s help, it’s something that one worker can actually manage.
On top of that, “The kitchens are a lot quieter,” because the fryer’s not beeping all the time. The result is a better customer experience, because the food is more consistent, and a better workplace for the staff.
That same Indiana location is testing a new drive-thru menu board with artificial intelligence technology.
Using voice recognition technology from SoundHound, the menu board can listen to and respond to customers. Guests can opt into a “known-user experience” that allows the AI to recommend menu items tailored for them. Or unknown users can be offered popular food and drinks or daypart-specific items “and likely upsells,” Carrol said.
The technology also is capable of doing “basket analysis” — assessing what’s been ordered and making “really good suggestions” of what the customer would like want to add, Carrol said.
The AI can also be mindful of how busy the restaurant is — not overburdening Flippy with more fries if its operating at capacity, for example — and sourcing issues, such as shying away from onion rings if they’re in short supply.
Rebhun said restaurants should consider the sort of technology that makes for smarter sales suggestions.
He said El Pollo Loco is using an AI product called Merlin that will make the chain’s loyalty program more efficient.
“If you have a machine that’s poring over constant streams of data, the level of accuracy that you can achieve with that is paramount,” he said, allowing them to get more strategic with offers — suggesting items customers are likely to order and not offering deals or discounts where it’s not necessary.
Keenen said that the next steps to touchless ordering are nuances such as two-way conversations about follow-up needs such as drink refills or dessert.
Source: NRN.com / Oct 16, 2020
Watch the Touchless Tech Panel Here
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Ghost kitchens. Host kitchens. Dark kitchens. Virtual restaurant. Delivery-only menus.
Whatever you want to call them, this seemingly infinite virtual restaurant space — geared for delivery-only products — is erupting amid the coronavirus pandemic. Restaurants are turning to various forms of ghost kitchens to create new off-premise revenue channels.
“We had already been moving into a stay-at-home economy before the pandemic, and it has only been fast-tracked as a result of the recent crisis,” Fazoli’s CEO Carl Howard said.
Fazoli’s joins dozens of chains trying everything from host to ghost kitchens, including Chili’s, Maggiano’s Little Italy, Applebee’s, Ruby Tuesday, Nathan’s Famous, Just Salad, Saladworks, Sweetgreen, Dickey’s, Smokey Bones, Chuck E. Cheese and BurgerFi.
Experts and ghost kitchen supporters say delivery-only menus are especially important for casual-dining chains which are trying to survive a crisis that has crippled on-premise revenues.
“As the demand increases for virtual stores, we will start to see sit-down restaurants, especially casual dining, disappear unless they can find a new way to innovate,” said Tim Powell, managing principal at industry consultancy Foodservice IP in Chicago.
Foodservice IP forecasts ghost restaurant sales to increase 42% this year with unit growth projected to grow 18%. That’s readjusted from an 8% unit growth projection pre-COVID-19.
Prior to the pandemic, limited-service chains were among the first to experiment with ghost kitchen facilities popping up across the U.S., including Kitchen United, Zuul Kitchens, Epic Kitchens, Reef Kitchens, Kitopi, CloudKitchens and DoorDash Kitchens.
But over the last few months new types of partnerships are emerging — including franchise models and host kitchen setups. One brand taking advantage of all types is Nathan’s Famous.
The iconic hot-dog chain from New York City has been looking at the ghost kitchen space for more than a year, said James Walker, senior vice president of restaurants at Nathan's. The 200-unit Nathan’s has signed partnerships with Reef Kitchens, Kitopi and Franklin Junction to expand the brand’s reach to at least 500 delivery-only locations.
Walker, who was previously a senior vice president at Subway, said this is a strategic move to provide accessibility for the brand through a sustainable revenue channel.
Another business Nathan’s is working with is Franklin Junction. Company founder Aziz Hashim said his company, which launched during the pandemic, is a cross between Airbnb and Match.com for the restaurant industry.
Atlanta-based Franklin Junction uses proprietary data to ensure restaurants like Nathan’s are matched with host kitchens that are in the right market, where there’s demand for their menu as a delivery product. The company also ensures brands are matched with host restaurants that have the correct kitchen equipment needed to cook products.
In the case of Nathan’s, Franklin Junction matched the hot dog chain with Ruby Tuesday and Frisch's Big Boy restaurants. In select markets, each restaurant is cooking and selling Nathan’s signature menu items.
Thus, they are acting as a host kitchen.
The host kitchens collect revenue from selling a secondary product for delivery only. They, in turn, pay Franklin Junction a fee per transaction. From that fee, Franklin pays Nathan’s.
Hashim declined to discuss the exact cost structure, as every agreement is different, he said. He expects to have 1,000 facilities join the platform by the end of 2020.
The Franklin Junction model looks for unused kitchen space in existing restaurants, often called a dark kitchen setup. Some chains are taking a similar approach with their kitchens including casual dining brands like Chili’s Grill & Bar, Maggiano’s Little Italy and Smokey Bones.
Brinker International, the parent company of Chili’s and Maggiano’s, rolled out its first virtual brand It’s Just Wings in late June. Less than a month later, CEO Wyman Roberts said the new venture could grow into a $150-million-a-year business in its first year.
Found on DoorDash’s delivery platform, the virtual brand is made in 1,050 Chili’s and Maggiano’s locations. The restaurants are acting as “dark” kitchens for the new brand, so there was very little upfront capital needed to launch the wings.
Wade Allen, senior vice president of innovation at Brinker, said the company leaned into wings because it’s a popular delivery only item.
“It played to our strengths. It was a hot concept. We knew we could do them well. And we knew it wouldn't operationally disrupt us or be capital intensive,” he said.
And by leveraging the scale of the two casual dining chains, Allen said Brinker has positioned the company to be “the biggest player in the virtual brand space today.”
Some chains like Saladworks and Smokey Bones began their ghost kitchen operations last year, setting themselves up for a smoother expansion during the pandemic.
Saladworks opened a ghost kitchen at Kitchen United’s facilities in Chicago and Scottsdale, Ariz. a few months before the pandemic hit in March. That led to talks with Reef, which offers a different type of delivery-only model.
Reef Kitchens operate on-demand food hubs inside its parent company’s high-tech parking facilities, as well as mobile food trucks. The business model is a licensing agreement much like a franchise partnership, where Reef is the operator and hires the employees.
Once the pandemic hit in March, Saladworks was able to accelerate the rollout of that relationship because talks were underway, Saladworks CEO Kelly Roddy said.
As of August, Saladworks’ menu is now being sold at nearly 20 Reef locations in the U.S. The chain is now looking at partnering with a ghost kitchen facility in Canada.
While Saladworks is expanding its footprint with its existing menu using ghost kitchens, Smokey Bones and Fazoli’s are taking the same approach as Brinker.
They’re using their existing kitchens to create “virtual restaurants” or delivery-only brands. Like Saladworks, Howard said he’s glad he had several months to work out the kinks before the pandemic.
“The timing of ghost kitchens may be perfect for those who are nimble and already have their projects underway,” he said.
This summer, Smokey Bones expanded the delivery-only burger and wing brands to all 61 of its restaurants — essentially creating three different menus under one roof.
Smokey Bones CEO James O’Reilly calls what he’s doing a growth hack. He’s carving out two new brands from Smokey Bones’ existing menu and giving them their own platform on third-party delivery sites.
“By opening these new virtual restaurants, we can go head-to-head with some of the largest full-service and fast-casual wing and better burger restaurant chains,” O’Reilly said.
The casual dining company’s next move is expanding the two virtual concepts by partnering with ghost kitchen facilities in markets where Smokey Bones doesn’t exist.
But is there such a thing as saturating the virtual restaurant space with too many brands?
Gary Stibel, founder and CEO of New England Consulting Group, said ghost kitchens makes sense with a pandemic or without a pandemic.
But, many operators, fueled by the pandemic, are jumping into the space haphazardly without a real plan.
“Most of these concepts will fail,” he said. “But a few will emerge and they're going to be mainstream.”
“It’s essentially a battle for market share in the virtual space just like it is with a brick-and-mortar physical space,” he said. “Excellent culinary execution and excellent delivery execution will ultimately be the factors that will determine which brands are more successful and which brands are less successful.”
Source: NRN.com / Aug 25, 2020
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Changing the way R&D is done, maintaining the creative spark and developing menu items that travel well.
These points were explored by Sharon Lykins of Denny’s and Joel Reynders of Tijuana Flats Tex-Mex during their panel at Restaurants Rise powered by MUFSO.
The hands-on nature of researching and developing a restaurant menu has been yet another thing this industry has lost during the pandemic. Going out into the world, tasting new trends and following hot leads has been replaced with Zoom meetings, takeout and training by Go-Pro.
“The challenge has been missing the actual R&D of getting out and seeing the trends,” said Joel Reynders, Vice President of Culinary & Executive Chef, Tijuana Flats Tex-Mex, who along with Sharon Lykins, Sr. Director, Product Innovation, Denny’s, shared their menu planning experiences in 2020, a year unlike any other.
Consumers are fatigued—by the year in general—and “they are looking for something new,” Lykins said, adding that she’s been trying to find a balance between new things and comfort food constants. All of this shaded by the shadow of the unknown. One lesson she’s learned: People definitely still want pumpkin pancakes.
“When we were buying pumpkins in June or July, we have to be very conservative with how much we purchased, knowing that we wouldn’t be sure of the lay of the land,” Lykins said. “We made sure the marketing materials said, ‘while supplies last,’ which is a good thing, because we ended up running through the inventory halfway through the promotion. But we were very concerned with our franchisees getting stuck with dead inventory, so that’s the good news; the bad news is we could’ve sold more.”
Tijuana Flats introduced a new menu item, the Queso Crunch Burrito, during the pandemic that has been a smash hit, thanks in part to its ability to travel well.
“We have such a large group that is eating at home,” Reynders said. “So, this is something we felt would travel better and it went over really well with our guests…that’s the fatigue part—they needed something new just to keep them coming back.”
Overall, menu development during the pandemic has meant “smaller processes, move faster, take more on,” Reynders said. “It got a little crazy, but crazy is good at times.”
Lykins added that Denny’s has been taking a close look at packaging, too, adjusting the Denny’s Dome packaging away from Styrofoam but still keeping the venting for pancakes and moisture retention for sausage and eggs. “We want to make sure when it gets to your house, you still want it and you have a good experience.”
Handhelds and one-bowl meals have been the comfort Denny’s customers have been looking for, Lykins said.
“People want comfort food but that doesn’t mean it’s a meat and two sides,” she says. “The warm handhelds give you comfort moments, so we see these hot sandwiches and bowls and one-plate meals really becoming stronger and stronger.”
“This has been a time for us to look at what’s really important, and what’s ancillary,” Lykins said.
Source: NRN.com / Oct 23, 2020
Watch the R&D at a Distance Panel Here