Sponsored by GRUBBRR
It is no secret that the pandemic has brought with it a multitude of challenges for the restaurant industry. Fortune reported that over 110,000 U.S. restaurants have closed to date due to the pandemic, and still three prominent challenges remain: inflation, the labor shortage, and increased demand for omnichannel dining. For many restaurants, turning to self-ordering technology helps solve each of these challenges by increasing revenue, reducing operating costs, and improving the customer experience.
This February, inflation in the United States reached a new 40-year high, with consumer prices jumping 7.9% from a year ago — rising at a pace not seen in four decades. To adapt, restaurants are altering menu items and increasing menu prices, passing on their macroeconomic cost pressures to their consumers to offset higher costs for food and labor.
In practice, this means that restaurants are either downsizing or raising the prices of their value meals. Datassential found that U.S. restaurant chains were promoting less than half the number of combo and value meals last year compared to 2016, and Technomic found that most categories of value-meals had increased in price over the past year.
However, passing on prices and changing value items can negatively impact the consumer experience. The Yelp Economic Index showed in January that customer reviews mentioning price increases grew 29% from Q4 2020 to Q4 2021, and Technomic reported that 45% of consumers say they usually pick restaurants with lower prices. Self-ordering technology directly addresses the effects of inflation by adding value back into the hands of restaurant operators, and the benefits are threefold.
The Great Resignation
The Great Resignation is the current reality that the restaurant industry faces, and it shows no sign of letting up. According to the latest jobs report from the U.S. Bureau of Labor Statistics, the unemployment rate in the hospitality industry is 8.2%, more than double that of the general economy.
Restaurants have made several operational changes, including limiting hours of operation, reducing dining capacity, and removing menu items. All of the aforementioned fixes negatively impact the consumer experience and can decrease profits over time. While many restaurants have increased employee wages and improved benefits, the nature of hospitality work (in-person, disjointed hours, frustrating customers) has dissuaded many from returning to the industry.
To adapt, businesses have two options: compete with their counterparts for a limited supply of prospective employees or automate business functions to cut back on labor costs and eliminate disruptions to business. For many, the answer is clear: automation is the way of the future. Reimagining labor by combining their existing labor force with automated self-ordering solutions has proven powerful in combating The Great Resignation.
Increased Consumer Demand
Cities across the nation are listing their COVID mandates for indoor dining. The restaurant industry was one of the sectors hardest hit by the pandemic, and for many just surviving was nothing short of a miracle. During this time, many restaurants turned to automation such as self-ordering technology which provided them with the tools they needed to keep their doors open.
However, now that restaurants have begun to return to “business as usual,” consumer demand is skyrocketing. Sam Zietz, CEO of self-ordering technologies company GRUBBRR, said that, “It is my opinion that this demand for omnichannel dining, a byproduct of the pandemic, is here to stay. Today’s consumers want to get what they want, how they want, when they want to get it. By maximizing the number of touchpoints consumers can use to access your restaurant, you increase your potential customer base and simultaneously create personalized guest experiences that lead to additional revenue generation.”
Because today’s guests want to get their food in a multitude of ways, restaurants need technology that delivers a consistent consumer experience whether guests want to eat in on premises, order online and pick up in a restaurant or curbside, or have the food delivered. Technology, including the Samsung kiosk powered by GRUBBRR, allows businesses to run their restaurant with fewer employees, thus maximizing labor, while simultaneously providing multiple touch points to service consumer demand for omnichannel dining.
For restaurants struggling with inflation, the labor shortage and increased consumer demand for omnichannel dining, the benefits of implementing self-ordering technology are threefold. First, it increases revenue. The Samsung Kiosk powered by GRUBBRR uses innovative upsell technology to increase average ticket size by up to 40%. This means that consumers are presented with an option to add an item to their order that corresponds with what they are currently ordering for every transaction.
For example, if a customer is ordering a burger, they may be prompted to add a side of fries or add avocado for a surcharge. If a customer is ordering a salad, they may be prompted to add a fruit cup or healthy beverage to complement their meal. In this way, self-ordering technology directly addresses the effects of inflation by prompting consumers to spend more with each ticket without the need for drastically increasing menu prices.
Second, self-ordering technology saves on labor costs. Research from Deloitte shows that 70% of consumers prefer to order using self-ordering technology rather than ordering from a cashier. In addition, replacing your cashiers with the Samsung Kiosk powered by GRUBBRR can move that staffer to the production line or other areas, increasing throughput and driving more revenue.
In addition, the one-time cost of a kiosk is a fraction of the price of carrying an employee. On average, a cashier at a quick-service restaurant open 15 hours per day will cost more than $6,000 per month (with all associated carrying costs). In contrast, the Samsung Kiosk powered by GRUBBRR is $2,500 upfront and $200/month for SaaS. Kiosks always show up, don't call in sick, and are ready to work 24/7/365, meaning your restaurant can more adequately service consumer demand while saving on labor inflation.
For many restaurant operators, replacing their cashier with self-service technology, such as the Samsung kiosk powered by GRUBBRR, allows them to run their business more efficiently with fewer employees, all while generating additional revenue. Implementing automation to work alongside employees can not only help retain your existing restaurant staff, but also repurpose them to other essential functions of the restaurant, thus maximizing labor.
Finally, self-ordering technology improves the customer experience. The Samsung Kiosk powered by GRUBBRR minimizes human contact, eliminates ordering errors, and allows businesses to implement integrations, such as loyalty programs and discount codes, that reward consumers. GRUBBRR's loyalty integrations enable businesses to capture data intelligence about consumer history, including most recent orders, to execute suggestive selling and communicate more efficiently with the consumer. Using GRUBBRR technology, restaurant operators add value back into their experience and encourage repeat visits.