How Ghost Kitchens Keep Digital Ordering Alive

FEATURE STORY – PAGE 9 How Ghost Kitchens Keep Digital Ordering Alive

NEWS AND TRENDS – PAGE 12 Chipotle debuts digital-only dining concept

DEEP DIVE – PAGE 17 How cloud inventory management tools can solve back-of-house woes

FEBRUARY 2020

What’s Inside QSRs experiment with ghost kitchens and small, 4 delivery-focused stores, while fast casual restaurants push for branded app ordering over third-party solutions

Feature Story 9 An interview with Charlie Yi, CEO of Zoku Sushi, on how delivery-only kitchens can keep restaurants competitive as consumers’ ordering preferences shift

News & Trends 13 Recent headlines from the space, including Applebee’s fast casual debut and DoorDash’s recent Popeyes-promoting efforts to cement its market supremacy

Deep Dive An in-depth examination of how cloud-based inventory 19 management software can help restaurants quickly meet customers’ demands without overstocking perishable inventory

About 22 Information on PYMNTS.com and Paytronix

Acknowledgment The Order To Eat Tracker® is done in collaboration with Paytronix, and PYMNTS is grateful for the company’s support and insight. PYMNTS.com retains full editorial control over the following findings, methodology and data analysis.

WHAT’S INSIDE

Quick service restaurants (QSRs) are making moves to States last year, and Grubhub followed close behind gain efficiency, and some are even trading floor space at 30 percent. DoorDash has not been complacent for self-service kiosks. Fast casual eateries may be able with its successes, either, recently making a series of to churn out more meals if they do not have to worry moves to lure more consumers to its platform and raise about face-to-face customer interactions. its restaurant partners' profiles. That effort included a limited-time promotion in which DoorDash and Popeyes Shake Shack is a major player taking such an approach, provided free chicken sandwiches at no delivery cost trimming down its seating areas and designing separate for customers who placed orders over $20. entrances to get order-ahead customers in and out in a flash. Chipotle is taking the idea further, experimenting Not all restaurants are encouraging diners to turn to with new venue layouts featuring street-facing pickup third-party delivery aggregators, however. Many rea- windows that order-ahead customers can use to grab sons inform QSRs' reluctance to rely on these providers, their meals without even stepping into the restaurant. including delivery fees and customers developing loy- The emphasis on digital ordering is warranted, as 70 alty to the service rather than the QSR. Mediterranean percent of consumers use their smartphones in some eatery Dill & Parsley and sandwich chain Cousins Subs part of their meal-purchasing processes, whether to lo- both recently launched new ordering apps to circum- cate restaurants, find discounts or simply order and pay. vent these issues and entice customers with free food promotions and other offers. Order-ahead’s popularity is enabling restaurants to reduce their store footprints and shift funds from real Focusing on delivery is likely to give restaurants clout estate to features and business concepts. Some among younger consumers, as half of U.S. millennials restaurants are even doing away with customer-facing order delivery more often than they did two years ago, locations completely, opening ghost kitchens instead. compared to one-third of adults overall. Such trends These agile operations do not serve walk-in consumers may be spurring what chain restaurant Applebee’s and act as bases that restaurants can use to fulfill de- noted was a strong increase in its off-site sales. The livery orders. The money saved on property purchases company piloting a new restaurant model to support and rentals can help them lower menu prices and boost such orders. The new establishment has on-premises technological investments. seating for 72 customers and supports takeout and delivery services. This month’s Order To Eat Tracker® examines the latest delivery trends as well as QSRs' digital strategies to en- For more on these stories and other headlines from hance customers’ experiences. around the order to eat space, check out the Tracker’s News and Trends section (p. 13). AROUND THE ORDER TO EAT WORLD

Fast casual restaurants often turn to aggregators to expand their delivery reach — for good reason. DoorDash handled 35 percent of all meal deliveries in the United

WHY GHOST KITCHENS MAY EMBODY THE SPIRIT OF MODERN DELIVERY Executive Restaurants can no longer rely on quick delivery times to distinguish themselves, as diners are becoming INSIGHT more focused on meal quality and delivery price. These merchants must thus design efficient, low-overhead Restaurants face serious decisions when preparation and order fulfillment strategies to win con- choosing whether to partner with order sumers, according to Charlie Yi, CEO of online-only aggregator platforms or fulfill delivery in sushi restaurant Zoku Sushi. Reducing operational house. What should QSRs keep in mind as they weigh each strategy? costs will also allow restaurants to offer lower prices,

making them more appealing to customers. “Any QSR should sum up its order and delivery strategy in a single word: brand. For this month’s Feature Story (p. 9), Yi explained how a QSRs turn to aggregator platforms and third-party de- digital-only ghost kitchen model combined with an em- livery because it’s easy to sign up and test the model, phasis on taking orders directly — rather than through while in-house fulfillment carries additional upfront labor aggregator platforms — can help restaurants lower their costs. However, handing over the consumer front-end to expenses and cater to order-to-eat consumers’ chang- a third-party has consequences. Issues with everything from menu confusion to cold food on arrival are out of ing needs over the next decade. the QSR’s control, yet in post-delivery surveys, consumers blame the QSR before the delivery company. DEEP DIVE: HOW CLOUD INVENTORY In-house fulfillment, meanwhile, relies on expensive labor. MANAGEMENT TOOLS CAN SOLVE My favorite Indian food restaurant uses the owner’s son BACK-OF-HOUSE WOES for deliveries, but most chains don’t have that luxury. And Restaurants face particularly tricky inventory manage- while it’s nice to dream about a future in which robots handle all the last-mile problems, that remains … in the future. ment challenges that can be more difficult than other To truly succeed in first-party delivery, it’s best to think sectors'. Overstocking will lead to food spoilage invento- about it as … who you are. A great example is Jimmy ry losses, but understocking will provoke customers’ ire. John’s, which developed a system that thinks through all QSRs seeking to more accurately assess their supply the details from food quality to service to speed and price. Bolting this onto an existing experience can create prob- needs can utilize cloud-based software that provides lems because customer expectations are different — it’s real-time data. These digital supports spare QSRs from not like serving someone in a dining room or having them time-intensive manual inventory counting and let them meet you face to face. When it comes to delivery, [the cus- respond more quickly to emerging needs. This month’s tomer’s] entire experience exists in a virtual world up until they open a package back at home. Deep Dive (p. 19) examines QSRs' approaches to cloud At its heart, mobile order and delivery is part of a consis- inventory management tools and the technology's po- tent, positive brand experience. Maintaining focus and tential for fulfilling customer demands while limiting understanding how customers interact with each element inventory waste. of the process will lead to long-term success.”

ANDREW ROBBINS co-founder and president of Paytronix

ACQUIRE ORDER EAT CUSTOMERS

IN OUT

WEB APP STORE RESERVATION DELIVERY

PAYMENT REWARD REDEEM

IDENTIFY PREFERENCES PROMPT ANTICIPATE TARGET OFFERS REORDER

One-to-one offers via email • SMS • In-app messages • Push notifications • Geofencing

70% 70% Portion of consumers Segment of consumers who use mobile who would be more phones for at least likely repeat a QSR visit part of their QSR if they received ads experiences based on past orders

35% 18% Approximate portion of Share of restaurants the U.S. meal delivery that offer ordering market DoorDash capabilities directly in controlled in October their apps 2019

57% Share of consumers who have at least one QSR app on their FIVE phones FAST FACTS

How Ghost Kitchens Keep Digital Ordering Alive

Speedy delivery wowed hungry consumers in the 2010s, He explained in a recent interview with PYMNTS that but diners have since adjusted their desires and ex- long-term business plans must anticipate how an eco- pectations for the coming decade. Restaurants should nomic hit might impact diners’ buying habits. respond accordingly, developing efficient, digital-based “If there’s [a] slight [economic] dip or recession, you will operations that help them focus on shoppers’ new pri- see a bump in the road where instead of ordering five orities: quality meals at compelling prices. times a month, [diners] might think about [doing so] two Charlie Yi, CEO of sushi restaurant and ghost kitchen or three times,” he said. “[Even right now,] in places like Zoku Sushi, believes that eateries searching for stay- New York, the demand [for delivery] is there but … the ing power need to be sensitive of consumers’ budgets. price of delivery has gone through the roof. You might

be ordering something that online says it’s $10, but after plans and marketing. … What we focus on in New York you put on the delivery fee or the minimum or the tip, City is that … big word-of-mouth opportunity [for] lunch. you get a product that [costs] almost 75 percent more We’ve been focusing our sale efforts [there], and that or maybe double [that list price]. That’s a problem.” has a natural way of spreading the word around.”

Yi believes delivery-only models — also known as a dig- Office workers frequently eat together, he noted, so a ital kitchens or ghost kitchens — and in-house ordering single customer’s Zoku Sushi purchase exposes the are key to keeping business expenses low. They are brand to everyone around the break-room table. The especially critical to enabling sushi delivery at compel- restaurant has also been looking to generate more cor- ling prices, he said, highlighting the need for thoughtful porate catering orders with significant ticket sizes. strategizing. DESIGNING DELIVERY FOR FINANCIAL GETTING GHOST KITCHENS OFF THE STABILITY GROUND Some companies might turn to big-name ordering ag- A city like New York — where rents and minimum gregators, such as DoorDash or Grubhub, to get their wages tend to be higher — forces restaurants to care- brands in front of sizable consumer bases. Zoku Sushi fully manage their operational costs. Digital-only largely eschewed that approach, instead taking approx- kitchens have lower needs for front-of-house staff or imately 90 percent of its orders directly. A third party eye-catching corner spots on well-traveled streets, Yi does help deliver the items, however. This allows Zoku explained, slashing several expenses right off the bat. to avoid hefty commission fees, preserve its prices and He anticipates that even businesses with established build customer loyalty. Yi explained that those depend- full-service locations will leverage ghost kitchens to en- ing on aggregator services are especially vulnerable able low-cost expansion. to economic downturn. Such a struggle could prompt platforms to raise their fees, creating painful additional Zoku Sushi originated as an online-only operation and costs and forcing price hikes beyond what consumers does not have any brick-and-mortar storefronts. This will accept. meant the company had to build its following without being discovered by consumers walking around. “The big difference with a third-party app is the demand generation they can bring to bear,” he said. “That’s an “The billion-dollar question [is] how do you seize … the advantage but, unfortunately, it could be at cost of [a] opportunities and advantages of ghost kitchens? … 25-percent or 30-percent commission.” When you start as a digital native — when you didn’t build your brand in the traditional way as a restaurant Greater control over costs passed to consumers is crit- — how do you cope with that?” Yi said. “The way we en- ical to Yi, who believes that speedy delivery will not gage is [by] focusing on the product experience and distinguish restaurants and that diners may care more really on making sure that we have a strategy … through about getting a tasty meal at a desirable price. word of mouth and, of course, through digital media

© 2020 PYMNTS.com All Rights Reserved | 11 “If I [am in a big city and] go on [a delivery aggregator] and order something like Chinese food, there are doz- Under ens and dozens of Chinese restaurants that can deliver things to me fast,” he said. “Do I care if it [takes] 20 to 40 minutes? Not really. … What’s becoming more import- The Hood ant is the cost and the product quality. … Consumers What does it take to satisfy consumers as are expecting things to be on time … but I’m not sure their preferences evolve? [the restaurant] gets stars for it being [delivered within] 10 minutes. You get more stars if it’s affordable and the “We’re looking at opportunities to develop a product experience is meeting or exceeding [consum- text-based ordering system, which is counterintuitive ers’] wishes.” because everyone wants to see beautiful pictures on the app, but we’ve been getting other feedback where Consumers’ expenses are not restaurants' only con- people are [also] looking for simplicity. They can see cern. Zoku Sushi is also focused on making sure each plenty of great photos of a restaurant on Instagram meal turns a profit, and that its product is a relatively or wherever the case may be. … They know what the high-priced food item certainly helps, Yi added. product looks like.

“Whether you’re delivering a burrito or caviar, it's the People are [now] looking for a more convenient way same cost to deliver,” he explained. “Your order size per to order, especially if they are your returning custom- order must be able to pay for your fixed costs. For us, ers. [Consumers] register [themselves] and then we one metric that’s important is that, at a unit level, we do know [them] — we have [their] order [histories]. We not want our delivery costs to be more than 5 [percent] want to make the experience a lot easier for [them] to 7 percent of the order size.” on the front end, where we can enhance the experience … just by making it easy, so they don’t have to Consumers and restaurants are both sensitive to costs. go through putting in their credit card [information], A clear focus on profit-per-order paired with responsive- opening up the app [and] navigating through their last ness to shifting diner priorities may be key to helping orders. … Now we’re looking at low-tech [features], restaurants get ahead as well as withstand the future's but low-tech [features that are] very convenient. surprise economic hurdles. From our research, people end up ordering essen- tially the same thing, especially around lunch time. Even at catering level: ‘How many people this time?’ ‘25.’ ‘Same thing? OK. Done.’… They’re in a hurry [and] don’t have 15 minutes to talk to you or go through your app. They have 15 seconds to get it done.“

CHARLIE YI CEO at Zoku Sushi

NEWS & TRENDS

New restaurant Chipotle’s digital sales reached more than $1 billion in revenue in the past year, providing more than enough designs reason for the company to experiment with such restau- SHAKE SHACK TO OPEN TAKEOUT- rant designs. The company is also continuing to work AND DELIVERY-FOCUSED NYC with third-party platforms to build its online and mobile LOCATION presence. QSRs are increasingly valuing their online delivery and takeout options as 70 percent of consumers use their Delivery and loyalty mobile phones for at least part of the food purchasing process. Burger chain Shake Shack is considering this DOORDASH MAINTAINS DELIVERY reality by planning to open a Manhattan location that DOMINANCE WITH POPEYES PARTNERSHIP will mainly focus on takeout and home delivery orders. The experimental storefront will feature self-service ki- Third-party delivery platform DoorDash is moving quick- osks, limited seating and separate entrances for those ly to stay ahead of competitors, which include both looking to dine in and those who ordered ahead. The restaurant aggregator apps like Grubhub and branded company believes the design will ease in-store custom- restaurant apps. Its latest move was a joint promo- er traffic. tion with fast food chain Popeyes in which the former offered free chicken sandwiches from the latter with no Shake Shack previously improved its home delivery and delivery fee. The promotion lasted from Jan. 13 to Jan. mobile stature by partnering with third-party delivery 19 and applied to customers who ordered more than app Grubhub in late 2019, enabling it to reach additional $20 worth of food from Popeyes. customers and drive the former's growth and revenues. Promotional collaborations such as these seem to have CHIPOTLE DEVELOPS DIGITAL-ONLY become DoorDash’s signature play, as it inked simi- DINING CONCEPT lar exclusive deals with The Cheesecake Factory and This digital-first focus is spreading, with Chipotle Chipotle. This tactic appears to be working for DoorDash, Mexican Grill seeing an 88 percent jump in such sales which was responsible for 35 percent of all U.S. meal from 2018 to 2019. Online and mobile orders were re- deliveries last year. The company cannot afford to get sponsible for 18.3 percent of the QSR’s total sales. This too comfortable, however, as data shows that Grubhub growth has inspired Chipotle to develop a fully digi- is right on its heels, having represented 30 percent of tal restaurant that allows customers to pick up food meal delivery orders over the same time frame. they have ordered online ahead of time. The brand is experimenting with four different layouts for the con- JPMORGAN CHASE & CO. TO OFFER DASHPASS SUBSCRIPTIONS TO CREDIT cept, including two designs that feature drive-thru CARD HOLDERS “Chipotlanes” and two with simple storefronts and pickup windows meant for more urban settings. DoorDash has also formed a partnership outside the restaurant industry, working with financial institution

(FI) JPMorgan Chase & Co. on a new offering for its — they will receive 50 percent off the subscription for DashPass users. The DashPass subscription service the remainder of the year, however. enables customers to forgo delivery fees while also reducing service fees on orders over $12. The partner- APPETIZE PARTNERS WITH RESTAURANT365 FOR UPGRADED POS ship will see the FI offer DashPass subscriptions to its SOLUTION Freedom, Sapphire and Slate credit cardholders. Those who sign up for the service will save anywhere from $4 Restaurants must invest in technologies that can effi- to $5 per order, according to DoorDash. ciently handle their orders to ensure consumers quickly receive deliveries. This reality prompted point-of-sale Cardholders activate their free DashPass subscriptions (POS) management platform Appetize and accounting by making one of their JPMorgan Chase & Co.-branded and reporting solutions firm Restaurant365 to partner credit cards their default DoorDash payment method. up. The pair will create a solution that combines the Users’ perks vary depending on which products they former’s POS technology with the latter’s order man- hold. Those with Sapphire cards will have access to agement software, forming a modern POS offering DashPass for a full year, while Chase Freedom and Slate that combines restaurants’ accounting, operations and cardholders will have the subscription for three months

ordering systems for greater speed and security. The Established fast food brands are looking to enter this product will give restaurants real-time insights into fi- arena via partnerships or acquisitions, with Yum Brands, nancial and operational data, including information on the parent company of KFC, Pizza Hut and Taco Bell, food costs, sales performances and deliveries. The opting for the latter. It recently announced that it will solution will also be capable of examining consumer acquire Habit Restaurants for $375 million, granting it a transaction details, allowing restaurants to better per- potential gateway into the fast casual space. The sector sonalize offerings. saw consumer visits increase 3 percent from November 2018 to November 2019. Habit Restaurants owns and LOYALTY APPS VIE FOR SPOTS ON operates burger chain The Habit Burger Grill, which has CONSUMERS’ SMARTPHONES 286 locations throughout the U.S. and China. Habit stat- Mobile phones are the next battleground for QSRs, as ed that its restaurants saw same-store growth of about many are overhauling their loyalty and reward programs 3.1 percent during Q3 2019. to cater to consumers ordering meals with their phones. Mediterranean food brand Dill & Parsley and sandwich APPLEBEE’S TESTS OUT FAST CASUAL chain Cousins Subs are among those that have created CONCEPT IN ALABAMA apps to encourage customers to use their rewards Applebee’s is also looking into the fast casual dining programs. Their apps offer both returning and new cus- scene, piloting an experimental diner concept in Mobile, tomers deals and promotions, such as free food items Alabama. The pilot began in December 2019 and offers upon signup at Cousins Subs and $2 off purchases for an updated menu, order-ahead capabilities and home Dill & Parsley’s new rewards members. deliveries. Applebee’s chose to include these features after it saw a 14 percent increase in off-premises sales Consumers have limited space on their phones, meaning during Q3 2019. brands not only need to fight for more loyalty program members but also for app downloads. Smartphone Dine Brands Global owns Applebee’s and is continuing users are willing to download QSR apps, however, as a to explore fast casual with its other restaurant chains, recent report found that 57 percent of consumers al- including IHOP. The company plans to open a fast casu- ready have at least one such app on their phones. al concept related to the pancake house called Flip’d in Atlanta, Georgia this spring. Entering fast casual Next-level payments YUM BRANDS TO BUY THE HABIT BURGER GRILL FOR $375M CHILI’S PARTNERS WITH PRESTO FOR The fast casual restaurant space has always been TABLESIDE TABLET POS PAYMENTS competitive, but its growth is continuing even as other Restaurants are continuing to optimize customers' ex- restaurant niches, such as fast food, are seeing declines. periences as competition ramps up, prompting fast

casual brand Chili’s to team up with restaurant tech- Chili’s is also utilizing the partnership to experiment nology company Presto. The latter will enable tableside with a new sign-in feature that would allow loyalty payments for all of the former’s 1,250 U.S. locations and customers to log into their rewards accounts. The com- utilize the PrestoPrime tabletop device, allowing cus- pany could use this offering to collect data about users’ tomers to settle their bills with flexibility and speed. The dining experiences, enabling them to create more per- tablets, which accept credit, debit and mobile payments, sonalized, high-quality experiences in the future. will be attached to the restaurants’ tables and empower diners to order meals without servers. Customers can McDONALD’S UK TO ROLL OUT NEW PAYMENTS SYSTEM WITH ADYEN also use the solution to call management and waitstaff if their needs are not being met. McDonald’s UK is also upgrading its payment processes, working with Dutch payment processor Adyen to make transactions more seamless. The former will use the

© 2020 PYMNTS.com All Rights Reserved | 17 latter’s online payment technology, which consolidates for individual entities to carefully examine relevant de- all payment methods onto one platform to standard- tails before fully doing away with cash transactions. ize checkout experiences across locations, according to Adyen. The pair will also innovate McDonald’s UK’s THE LEGACY POS PROBLEM mobile payment platform and its loyalty system, which Fast casual establishments have other innovation the solution will manage. Adyen will also be responsible questions they must answer as modern payment tech- for processing and supporting United Kingdom-based nologies continue to affect customers’ dining and payments through McDonald’s mobile app, including payment preferences — a major issue for those relying order-ahead purchases and home deliveries. The two on legacy systems that do not support these payments, companies plan to expand their partnership throughout order-ahead or home deliveries. Newer POS offerings all of McDonald’s global locations, though they have not utilize cloud-based technology to manage and support yet disclosed where they are going to launch next. multiple payment and order methods, enabling more personalized user experiences and increasing employ- QSRs CONFRONT THE CASH QUESTION ee efficiency. The question of whether or not QSRs should accept Fast casual restaurant workers are often younger and cash has had operators scratching their heads for sev- generally more able to adapt to upgraded systems than eral years, and the debate will continue into 2020. Many legacy POS products. Training employees on outdated brands are asking themselves if they should jump on terminals could take between two to four hours per em- the cashless trend, citing transaction speed benefits ployee, according to Garrett Fadden, senior director of and the declining overhead costs electronic payments retail IT systems for Focus Brands, which owns Auntie create. Going cashless could also entice diners to Anne’s and Cinnabon. Cloud-based POS services train- spend and tip more. A recent study noted that average ing cuts that time down to minutes, he added. customers spend approximately 12 percent to 18 percent more when paying with credit cards than with other methods and that diners tip about 13 percent more. QSRs are thus examining other digital payment methods and technologies that could be added to their POS systems in lieu of cash, including mobile payments like Apple Pay and Google Pay.

Going cashless may not be the most prudent business move for some QSRs, however, depending on their locations and the number of their customers who still use cash. These factors differ by brand, making it important

How Cloud Inventory Management Can Solve Back-Of-House Woes

Inventory management is a constant struggle for many Such shortages are common in the restaurant industry, businesses, particularly QSRs. It is difficult to accurate- but the scale of the Popeyes incident was particularly ly forecast how much inventory is necessary to meet remarkable: Two months passed before the chain could demand without purchasing too much, which could bring the item back. Felipe Athayde, Popeye’s president waste both money and food. for the U.S. market, attributed the shortage to a vast un- derestimation of demand. One notable inventory management challenge occurred last year when fried chicken QSR chain Popeyes intro- “We thought we wouldn’t have any problems at all, at duced a new chicken sandwich. The item became a least until the end of September,” he told The New York national phenomenon due to a widespread belief in its Times. “We made a decision to stop, but technically, it superior taste and a viral marketing campaign highlight- wasn’t a decision. We came to the realization we were ing its availability on Sundays, unlike the offerings of stopping. There was no alternative.” competitor Chick-fil-A. It was so popular that some mu- Popeyes’ chicken sandwich shortage can teach QSRs nicipalities had to shut their Popeyes drive-thrus down many lessons, including the value of real-time invento- due to overflows, and all of the chain’s restaurants na- ry management and how best to restock on demand. tionwide were sold out of the sandwich less than two Cloud-based systems can help restaurants mitigate weeks after its introduction. these issues and avoid hungry customers’ wrath.

KEEPING QSRs ON TOP OF INVENTORY Cloud solution providers have found that precise stock- Cloud-based inventory software offers restaurants ing done through inventory management systems can looking to improve operational efficiency several ad- increase order efficiency by up to 50 percent and re- vantages, including real-time tracking. Such features duce food costs by up to 5 percent — numbers that prevent QSRs from having to pay staff to conduct represent the difference between being in the red or time-consuming and tedious manual counts after in the black. Many restaurants that utilize these tools hours. McKinsey & Company estimates that produc- are already seeing them pay off, and even small, typi- tivity in companies with connected tools — like cloud cally slow technology adopters are becoming adept in management software — is improved by up to 25 per- their use. cent compared to those without such supports. CLOUD MANAGEMENT IN ACTION An up-to-date view of on-hand inventory also helps Numerous chains now use cloud-based inventory restaurant managers better understand ideal restock- management software to improve their in-house effi- ing practices. Many cloud-based systems are equipped ciencies and boost profits. Nationwide QSR giants like with automated purchasing capabilities that lift respon- Five Guys, KFC and Wendy’s leverage these tools, and sibility and pressure entirely off managers’ shoulders. smaller chains like Bruegger’s and Dog Haus are also Nathan Pickerill, senior director of product strategy at realizing their benefits. restaurant operating system provider HotSchedules, likens cloud inventory management tools to smart Cambridge, Massachusetts-based Clover Food Labs, wearables that track steps and calories burned — easy which has 12 locations and 300 employees, is anoth- tasks for computers, tedious ones for humans. er small chain utilizing cloud technology. Its flat screen menus are connected to inventory management soft- “We use smart technology in our everyday personal lives ware via a cloud-based operating system, allowing for to handle simple tasks, [so] why can’t restaurant man- dynamic menu updates based on what the restaurant agers use the same type of technology to automate has in stock. The menus stop displaying products that theirs?” Pickerill explained to QSR Magazine. “Intelligent rely on out-of-stock ingredients and connect to restau- inventory software is going to be able to crunch that rant managers’ iPads for further real-time adjustments. data way faster than a busy manager, and that busy manager will know exactly what to focus [his or her] at- Additional restaurant chains of all sizes will likely join tention on.” these ranks as cloud-based inventory management tools become more advanced and accessible. This Cloud inventory management software can also miti- technology may prove to be the key ingredient behind gate the industry’s constant struggle with food waste. keeping high-demand items on the menu. Most retailers can reduce their upcoming shipments and sell excess inventory before restocking, but restaurants do not have this luxury due to food spoilage.

© 2020 PYMNTS.com All Rights Reserved | 21 PYMNTS.com is where the best minds and the best content meet on the web to learn about “What’s Next” in payments and commerce. Our interactive platform is reinventing the way companies in payments share relevant information about the initiatives that make news and shape the future of this dynamic sector. Our data and analytics team includes econ- omists, data scientists and industry analysts who work with companies to measure and quantify the innovations at the cutting edge of this new world.

Paytronix provides software-as-a-service (SaaS) customer experience management (CXM) services for restaurants. Its portfolio includes loyalty, gift and email solutions for fast-casual, fast food and quick service restaurants. Once implemented, these can be used to help establishments el- evate their brand profiles. Its offerings can also be used to generate data insights to help restaurants pinpoint opportunities to improve their operations and customer engagements. The company’s platform can integrate with many wide- ly used restaurant POS systems. For more information, visit https://www.paytronix.com.

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