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Shake Shack pushes further into convenience with kiosk test

Burger chain also tries going cashless as it seeks to improve customer experience

Shake Shack Inc. is doing away with the traditional order taker, at least at one location.

The New York City-based burger chain said Tuesday that it plans to test kiosk-only ordering at its Astor Place location in the city.

The kiosks will be paired with “hospitality champs” inside the location. Workers will be paid at least $15 an hour, and the company hopes the experiment helps reduce wait times and improve throughput.

The location, CEO Randy Garutti said, “will be a playground where we can test and learn the ever-shifting needs of our guests.”

It also plays into what Garutti said earlier this week was a major shift toward convenience.

Speaking at NRN’s MUFSO Conference on Monday, Garutti said consumers’ demands for convenience was the industry’s biggest shift since the creation of the drive-thru.

Consumers “are more than happy” to pay for convenience, he said, particularly with delivery.

The Shake Shack location testing kiosks and cashless is on the corner of 9th Street and 3rd Avenue in New York City, and is set to open early this month. It will feature several kiosks that do not take cash and what the company calls an “optimized kitchen” with better throughput.

The kiosk was developed to allow Shake Shack to serve more guests at peak times, either in store, through the mobile app or delivery. The chain hopes the kiosks will result in fewer lines and less wait times at every channel.

Employees will be stationed around the kiosks to help customers with orders and answer any questions.

Shake Shack is not the first limited-service chain to consider adding kiosks. McDonald’s and Wendy’s are both in the midst of adding self-ordering kiosks at their locations as the chains seek to improve the speed and accuracy of in-store ordering.

And Shake Shack isn’t the first chain to work on cashless restaurants.

The fast-casual salad chain Sweetgreen said last year it would go fully cashless. And San Francisco-based Eatsa uses kiosk ordering at its locations.

This summer, Visa started a “Cashless Challenge,” saying it would pay $10,000 to 50 restaurants to go completely cash free. The restaurants must answer the prompt, “How going cashless would benefit your business.” Winners get the tools they need to eliminate cash from their locations.

But Shake Shack adds the heft of its well-known, publicly traded brand to the push toward cashless restaurants.

The company has more than 85 locations in the U.S. and 50 international locations, and many of them struggle with long lines and slow service. Same-store sales this year have turned negative, including a 1.8-percent decline in the quarter ended June 28.

The location also pushes the chain further into higher wages. The company said it would have a starting wage of $15 an hour “to continue to be on the forefront of competitive wages and developing the leaders needed for growth.”

Shake Shack last year boosted pay for workers at all of its locations, and New York City is ultimately going to a $15 wage.

“People should be paid to take care of families and live a comfortable life,” Garutti said in an interview earlier this year.

While the higher wages drive up labor costs, Garutti said, “We don’t lead the company for percentages, we lead it for dollars, and we make a whole lot of dollars. If we go down as a percentage, it’s because we’re taking care of our team, but we’re rising in overall sales and profit.”

Contact Jonathan Maze at [email protected]

Follow him on Twitter: @jonathanmaze 

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