HOW YOU CAN GROW YOUR RESTAURANT SALES AND CUSTOMER SATISFACTION WITH MINIMUM FRICTION, COST AND RISK

A BEGINNERS GUIDE TO SELF-SERVICE RESTAURANT KIOSKS A BEGINNERS GUIDE TO SELF-SERVICE RESTAURANT KIOSKS

EXECUTIVE SUMMARY Self-service kiosks are going to remain a huge market trend among QSR and fast-casual restaurants in the following years. It’s easy to understand, because of numerous advantages they bring together: +30% -40% +76% They increase sales (up to 30%), service SALES WAITING TIME CUSTOMER speed (by 40%) and market share, they SATISFACTION improve customer satisfaction (up to 76% of customers), help involve customers into restaurant’s omnichannel Once implemented, they can be a great experience and collect more data about start for further digitisation of your their behaviour and preferences. Whilst restaurant business, helping you achieve highly beneficiary to the organisation the complete omnichannel approach, they can be implemented in a relatively including web and mobile interfaces, simple way with a minimal IT and third-party ordering, improved loyalty organisational cost without disrupting of schemes, delivery management and your already-functioning POS system. much more.

3E.PL 2 A BEGINNERS GUIDE TO SELF-SERVICE RESTAURANT KIOSKS

Perhaps you’ve seen some in-store This means that, in the coming years self service kiosks in your competitor’s restaurants. American brands such as McDonalds, Panera Bread, Johnny THE MAJORITY OF YOUR Rockets have introduced them COMPETITORS (PROBABLY ALL successfully since 20151. Soon after, their competitors like Wendy’s and Dunkin’ OF THEM) ARE HIGHLY LIKELY Donuts followed suit. AmRest, one of the biggest European QSR and fast-casual TO IMPLEMENT SELF-SERVICE operators began implementation of kiosks KIOSKS IN THEIR STORES. in their KFC restaurants in 20172. In addition to the biggest chains, self- service kiosks are appearing left and right INNOVATION IS THE KEY in smaller outlets such as grocery stores, TO COMPETITIVENESS petrol-stations, and airport shops. 80% AND THIS TREND IS NOT COMING TO AN END. The train has departed, and the self service kiosks are no longer a technical According to Transparency Market novelty, they are going mainstream. Research 2018 report, the global According to the 2019 PYMNTS Retail interactive kiosk market is projected to Innovation Readiness Index3, grow at an annual rate of almost 7 percent, 80% of food services merchants to reach the stunning number of see technical innovation as one of their main competitive strengths - with kiosks being one of the main 120 BLN USD vehicles of innovation in their by 2026. omnichannel strategy.

1 https://www.kioskmarketplace.com/blogs/as-restaurants-embrace-self-order-kiosks-remember-the-pioneers-that-led-the-way/ 2 https://www.3e.pl/kfc-kiosk 3 https://www.pymnts.com/news/retail/2019/qsr-digital-innovation/

3E.PL 3 A BEGINNERS GUIDE TO SELF-SERVICE RESTAURANT KIOSKS

This was the most obvious problem4 WHAT MAKES US SO our clients experienced. Kiosks are the SURE ABOUT THIS? most time efficient way , to unburden the jammed cash desks - their implementation can reduce total order time by 40%. 1 We live within the self- While the customers are busy placing their orders via the kiosks, the staff can - tech-savvy, mobile- service nation focus on preparing meals, cleaning, and enabled individuals for whom the digital all the other essential activities, therefore platforms is the most natural way to increasing overall restaurant capacity. interact with brands. It was as early as 2015 when Ryan Buell, a researcher at Harvard 1 Business School noticed that a lot of ORDER TIME customers prefer to tap on the touchscreen than talk to a clerk. Why? Primarily - just to avoid social friction. Some fear being -40% misunderstood (especially when a product has a foreign name), some on the other Speed is also highly appreciated by hand, are shy or, in other words, “don’t like customers. According to the 2019 survey by 2 interacting with cashiers” . This self-service one of IoT companies, 76% of customers nation is quickly growing - they make have a better in-store experience5 when up 12% of Baby Boomers, 20% among sales process is enhanced and sped-up by Millennials and perhaps more than 50% technology, a number that has increased 3 among Gen-Z - the generation born in the by 10% from the previous year! late 90s and early 2000s.

BETTER EXPERIENCE +76%

Last but not least - speed is market share. Kellogs School of Management reported in it’s research from 2014, that reduction of service time by 7 seconds can increase 12% 20% 50% 6 BABY BOOMERS MILLENNIALS GEN-Z the company’s market share by 1 to 3%.

It has been proven by numerous 3 studies that: restaurant customers buy more, whilst 2 Automated service is faster. using kiosks than when placing orders Have you ever seen customers leaving the at the cash desk. This law has proven itself restaurant during peak hours, fed up with through many years both in the US7 and in waiting in line? We know, you have. our European implementations.

1 https://hbr.org/2015/03/how-self-service-kiosks-are-changing-customer-behavior 2 https://www.retailwire.com/discussion/are-millennials-building-a-self-service-nation/ 3 https://www.computerweekly.com/news/252434291/More-than-half-of-millennials-prefer-online-retailer-info-to-in-store-assistance 4 https://www.3e.pl/kfc-kiosk 5 https://www.retaildive.com/news/study-73-of-consumers-want-self-service-technology/546044/ 6 https://pubsonline.informs.org/doi/abs/10.1287/msom.1110.0343 7 https://eu.usatoday.com/story/money/nation-now/2018/06/07/mcdonalds-add-kiosks-citing-better-sales-over-face-face-orders/681196002/

3E.PL 4 A BEGINNERS GUIDE TO SELF-SERVICE RESTAURANT KIOSKS

Different brands report a sales increase provide a lot of data3 which can improve all from 20 to even 30%!1 data-driven marketing and sales activities. By measuring kiosk performance you can prove which marketing message works better, SALES UP TO which cross-sell offers are more compelling and which newly-introduced products +30% are more attractive. By making customers match their kiosk activities with their loyalty program account (i.e. by scanning their Why? Some customers are happy to avoid mobile app qr code at the kiosk) you can get negative judgment of their eating habits, a lot of additional data about their shopping so that they order more ingredients or habits. Importantly, this data belongs to you - more drinks. Some feel less pressure from therefore you don’t have to buy them it third the touchscreen than from the assistant parties such as tech giants. and therefore spend more time browsing the menu. Some just have fun checking 6 the upselling options.Furthermore, the Last but not least - implementation kiosk is never too busy to present these options to the customer. of kiosks does not lead to a reduction of staff - the rise in sales Kiosks are the important part usually compensates for the investment, and 4 of the customer experience in the increased traffic keeps the staff just as busy an omni-channel ecosystem. as before - with increased profits. According to Pymnt.com Restaurant Readiness Index, 62% of customers2 find omni-channel elements like online and mobile ordering, digital wallets and loyalty programs as a significant factor for their overall positive experience with chains. Kiosks greatly enhance that experience bringing to the store the look’n’feel that the customers have got used to using web and mobile apps and facilitating their access to their account and loyalty programs.

OMNI-CHANNEL IMPORTANT FOR 62% OF CUSTOMERS

5 Kiosks give you increased insight about your customers behaviour. Kiosks not only increase sales and enhance customer experience, they also

1 https://www.pymnts.com/unattended-retail/2018/kiosk-retail-report-vending-machines-usa-technologies/ 2 https://www.pymnts.com/study/restaurant-readiness-study/ 3 https://hospitalitytech.com/2018-restaurant-technology-study-insight-enabled-innovation?from=gate

3E.PL 5 A BEGINNERS GUIDE TO SELF-SERVICE RESTAURANT KIOSKS

ALRIGHT, SO SHOW ME HOW IT WORKS You should probably recognize this scheme - this is how a traditional POS (point of sales) system works. This is your headquarters, where you work on menus, manage your policies and pricing Whilst in the restaurant there’s a bunch of integrated POS equipped cash registers that take care of trading. T R A D I T I O N A L P O S S Y S T E M

R E S T A U R A N T Kitchen Display System

Collection point POS

Fiscal Barcode printer scanner Local POS server

Queue number display

C H A I N H E A D Q U A R T E R S

Central menu Central register / products description of orders

There can also be a range of other plugs into the kiosks (This can also apply functionalities as well e.g a loyalty system to other important features like mobile or a website allowing your customers to applications). place orders, that are in turn integrated with your POS software. Nonetheless This is a key reason as to why most most POS systems that have been industry experts insist, that it’s high time implemented in the second decade to start investing in the digitisation of of the 21-st century (and earlier) such the restaurant business. as Oracle Micros or iiko aren’t usually equipped with a dedicated solution that How can this be done?

3E.PL 6 A BEGINNERS GUIDE TO SELF-SERVICE RESTAURANT KIOSKS

1. SOLUTION ONE: EXCHANGE that you make to the menu or loyalty system are instantly available on every YOUR POS TO A BRAND-NEW POS stand or kiosk. „„ it’s more flexible. As as cloud software, CLOUD-BASED POS SYSTEM. it can be continually developed and updated, without the need to upload changes to all the devices in the network „„ it’s less vulnerable in terms of crashing and disabling the service. It doesn’t require you to build your internal network, simply connect all your the devices to the internet This solution has considerable (although connectivity issues are still advantages, as new software usually possible, they can be easily solved, i.e. by installing a backup mobile „„ has integrated all the elements of connection in every restaurant) the digital restaurant. That means „„ is usually much cheaper in day-to-day not only the kiosks, but also web and maintenance, because, as previously mobile applications, loyalty systems, mentioned it doesn’t need its own integration with third party ordering network infrastructure websites and delivery management „„ offers more customization options solutions etc. for customers, „„ gives you a single point of „„ works on newer (and fancier) management access to the whole hardware. Basically you can use network. Since all the devices run the any connected device as a POS same basic application, any changes or kiosk stand.

C L O U D P O S

third party ordering web ordering mobile ordering R E S T A U R A N T POS SOP Fiscal printer

Barcode scanner kiosk Fiscal printer C L O U D S Y S T E M Barcode scanner Cloud server Collection point • menu/product description (optional) • orders register Fiscal • loyalty system printer • delivery management • statistics Queue Management System

Kitchen Display System Chain headquarters

3E.PL 7 A BEGINNERS GUIDE TO SELF-SERVICE RESTAURANT KIOSKS

When you start a new restaurant „„ probably purchase new licenses, business, implementation of an up to date, „„ purchase new restaurant hardware, cloud-based POS can be a rather obvious „„ integrate of all your corporate software decision. But is it necessarily worth it, when (ie. accounting, supplies, sales, etc) you just need kiosks and have more than with a new system, one (maybe even 100 or 500) store and „„ reimplement your menus, pricing, an expensive POS system already up and loyalty schemes and other policies on running and - finally - a limited budget your new software and timeframe to keep up with your „„ transfer your databases, including competitors? This is the million-dollar (or personal data in the loyalty system actually a much more expensive) question „„ re-train your staff „„ go through the implementation and If you are in such a situation you should debugging phase remember, that exchanging POS means you should: So how do you reconcile these two „„ scrap the current software, despite it is conflicting factors - the growing need potentially doing its primary job well to implement the kiosk and managing enough to remain in use budget and time constraints?

2. SECOND SOLUTION: MANUAL directly to the POS. They are simply plugged in to their own KDS (kitchen display KIOSK INTEGRATION INTO YOUR system) terminal. Some restaurants already are familiar with this method from third POS SYSTEM. party delivery solutions. The orders coming from kiosk application are printed or shown on the kitchen display and then should be typed again into the POS interface.

This solution allows you to take advantage of the most important kiosk assets: „„ allowing the youngest and most tech- savvy customers to place orders in the way that’s most natural to them This is the simplest, fastest and cheapest „„ increasing service speed during rush hours solution that lets you take advantage „„ increasing sales by presenting of most kiosk assets, whilst avoiding customers the upselling opportunities disruption of the existing POS system. In in more comprehensive and this solution kiosks do not send orders compelling way

3E.PL 8 A BEGINNERS GUIDE TO SELF-SERVICE RESTAURANT KIOSKS

K I O S K S I M P L E M E N T A T I O N Of course, this solution is significantly W I T H N O P O S I N T E G R A T I O N less elegant and less time-efficient for restaurant staff. You should also remember that it won’t let you skip some organisational changes, i.e. arranging of the receiving post with an order number display. But it is still worth considering, especially as a trial ONLINE ORDERING (OPTION) solution, that allows you to learn to use the third party web ordering mobile ordering kiosks to your advantage, improves your ordering (optional) (optional) (optional) sales and customer relations, and finally gathers evidence supporting further, more extensive upgrades of your system.

C L O U D S Y S T E M R E S T A U R A N T kiosk

Cloud server

Queue Management Kitchen Display System System Manual integration

Kiosk Kitchen Central Display System POS register Fiscal of orders printer

Barcode Central menu scanner / Product description Local POS server Fiscal printer C H A I N H E A D Q U A R T E R S Collection point

3. THIRD SOLUTION: The third way of plugging kiosks into your network lies somewhere between the two ENHANCING YOUR EXISTING POS previously mentioned . Once implemented it can serve you for years, whilst still being SYSTEM WITH A CLOUD-LIKE a huge step towards the full transition WEB INTEGRATION CENTRE to a cloud solution. In this version, kiosk application synchronizes with your currently-used POS, giving it all the kiosk superpowers whilst not interfering with its well-established processes. Instead of disrupting your business it instantly empowers it.

3E.PL 9 A BEGINNERS GUIDE TO SELF-SERVICE RESTAURANT KIOSKS

All the business activities including placing queues via POS API and numbered just orders, payments and sales statistics are as if they were entered manually by the deeply integrated with the system. cashier. Then passed to the kitchen and processed along with “normal” orders. „„ Kiosks are semi-autonomous entitis, „„ Kiosks have their own statistics and each of them running a web-based monitoring systems, that allows around application devoted to one and only task the clock monitoring of their status. - displaying of the menu, collecting orders and accepting payments - or passing WHAT’S CRUCIAL, THE CLOUD-LIKE INTEGRATION them to the staff cashier if the customer so chooses. CENTRE, IF NEEDED, CAN TAKE ON OTHER „„ They download the menu each day CRUCIAL TASKS, ENHANCING THE LEGACY POS directly from the cloud server, ensuring SYSTEM WITH ALL THE FUNCTIONS IT MAY BE that they always contain the up to date LACKING, LIKE ONLINE AND MOBILE ORDERING version - but throughout the day they work independently inside the restaurant and AND PAYMENT, CALL CENTER INTEGRATION, cannot be disabled by connectivity issues. THIRD-PARTY ORDERING AND DELIVERY „„ They use the same menus and product INTEGRATION AND MUCH, MUCH MORE. models as the original POS - therefore they “converse” effectively with the POS software. ALL THE CORE ELEMENTS OF THE SOFTWARE „„ They smoothly integrate into each ARE READY AND THE API INTERFACES ARE restaurants internal POS network, EASILY ADJUSTED TO PLUG IN INTO YOUR through one of the machines. Orders placed via kiosks are added to the ORGANISATION’S NETWORK.

L E G A C Y P O S - C L O U D P O S I N T E G R A T I O N

third party web ordering mobile ordering Loyalty system ordering (optional) (optional) (optional) (optional)

R E S T A U R A N T

kiosk Fiscal printer

Barcode scanner Cloud server (optional) Queue Management Kitchen Display System System C L O U D S Y S T E M

Central POS register Fiscal of orders printer

Barcode Central menu scanner / product description Local POS server Fiscal printer C H A I N H E A D Q U A R T E R S Collection point

3E.PL 10 A BEGINNERS GUIDE TO SELF-SERVICE RESTAURANT KIOSKS

SOUND COMPELLING? SO HOW DO YOU FIND OUT IF IMPLEMENTATION OF SELF-SERVICE KIOSKS ARE FEASIBLE AND PROFITABLE FOR YOU?

Firstly, you should contact the the most widely used systems like Oracle 1 provider, correct? ;) Micros or iiko, this phase can be much shorter than usual. The initial phase is short but intense. 2 When the team of developers integrates Now is the time for business analysis 4 and consultation. This is the phase during the kiosk software with POS, the other which you decide which of the solutions team takes care of creation of the UX and listed above suits you best. You should customer journey and all the elements that neither submit to the temptation to skip this ensure a delightful, smooth and effective, phase nor listen to such advice. Although the psychology-led customer experience. It overall business scheme, and therefore the is another part of the project that’s highly applications architecture are rather generic dependent on your corporate specifics and for most QSR and fast-casual restaurants and shouldn’t be implemented based on ready-to- chains, none of them are identical. To outline use templates. It should be aligned seamlessly the project you need to summarize all of with your restaurant’s menu structure, your constraints: your POS characteristics, ordering channels, your customers tastes, external apps, product models, the payment habits and your brand image. and fiscalization aspects, the size of your network - all of these factors can greatly The implementation is preceded by 5 influence the projects size and price. the testing phase. This is focused on finding and eliminating possible integration This phase of the analysis process is extremely loopholes as well as the interface UX, engaging and even fascinating for both parties efficiency and comprehensiveness. It and very fruitful from a business perspective. usually takes a portion of A/B testing and Going through business processes one step a few iterations to find the optimal version. at a time can be a great eye opener and a rare Just as important as the design is the front opportunity to rethink and optimize your end optimisation. The well written frontends business logic - at least partially. run absolutely smoothly as a top-class smartphone menu, with no annoying lag, on After the business analysis and relatively budget hardware. 3 evaluation, the process is split in two. On the one hand comes the The implementation process is relatively technical 6 analysis. During this phase usually tech a simple one. Since the kiosks are guys take the lead, analysing in detail autonomous, they can be installed one-at-a- all the APIs, and other touchpoints time in the stores over an extended period, between your ecosystem and the kiosk according to strategy and budget constraints. application. The time and complexity is Wherever installed, they plug smoothly into highly dependent on the characteristics of the system and start to generate additional your software. Actually, if you use some of profits from the very first day.

3E.PL 11 A BEGINNERS GUIDE TO SELF-SERVICE RESTAURANT KIOSKS

IF YOU HAVE FURTHER QUESTIONS PLEASE CONTACT US ...

HEADQUARTERS

3e software house

 ul. Podbipięty 51 02-732 Warsaw Poland

CONTACT

 +48 22 822 48 68  [email protected]  www.3e.pl

PRODUCT INQUIRIES

 [email protected]  +48 607 288 412

 [email protected]  +48 507 094 455

 linkedin.com/company/3e-software-house

 fb.com/3e-software-house

Icon made by Freepik from www.flaticon.com

3E.PL 12