Food and restaurants have been inextricably linked with human life for ages. To make this even more exciting, restaurants are shaping the consumer’s experience with quality food and the right combination of technologies. Recently, restaurant operators have struggled due to shrinking margins, the surge in ingredients cost, and changing customer behaviors, and COVID 19 is aggravating problems for the already bleeding industry.
Now, when normalcy is restored, market conditions are changing rapidly, and businesses require extreme agility to adapt to new customer behaviors and innovate ways to serve customers while optimizing costs.
This is an inflection point for the restaurant industry and the journey from here on will be driven by the right combination of digital technologies to improve in-store operations & boost the consumers’ confidence (dine out, delivery, curbside pick-up, drive-thru, etc.) while keeping an eye on costs.
Restaurant operators are facing multiple challenges and the ongoing pandemic has aggravated the problem. Various reports and business leaders highlighted the below challenges:
- The Coronavirus threat – The ongoing pandemic raised concerns for the safety of the customers, employees, and deliverymen inside & outside the restaurant. Customers are not willing to come out of their homes and avoid ordering food due to safety concerns, directly impacting the revenue for restaurants. As per the report from Open table – “As of January 2021, seated diners from online, phone, and walk-in reservations decreased worldwide by 63%”.
- Increasing delivery cost – This is one of the biggest concerns restaurant operators have since ages. Factors contributing to the surge in delivery cost are – labor cost, training of labor, cost of ingredients, improper inventory management, manual ways of working, etc. Companies are trying hard to bring down the delivery cost by controlling contributory factors.
- Rotating complex inventory – The restaurant industry is one of the fastest inventories rotating businesses. Efficient inventory management & optimization is an ongoing challenge hitting the bottom line.
- Longer wait time – Whether it is in the restaurant, drive-thru, pick-ups, or delivery, long waiting times/long queues directly impact the overall experience. Major factors contributing to long wait times are inefficient order management, labor availability, sync with the kitchen, etc.
- Handling orders – With digitization, consumers are reaching out to restaurants via multiple channels. Lack of order management/mismanagement leads to increased delivery cost, poor customer service, etc.
Focus areas to gain competitive advantage
This pandemic has been a wake-up call for the restaurant industry to ensure safety, understand the customer needs, reimagine the experience, and optimize the cost leveraging technologies like AI/ML, Automation, IoT, Cloud Adoption, etc. Below are the key areas where restaurant operators can focus to transform the experience & in-house operations to achieve competitive advantage:
- Safety comes first – Health safety is the top priority. To boost the confidence of the customers, restaurant operators must leverage technologies to create a digital shield that will enable – automated temperature checks for the employees & customers, limit the number of people in the venue, periodic sanitization alerts, image processing for mask detection, contactless ordering & delivery, etc.
- Delivering quality food – Restaurants need to understand customer needs by analyzing the myriad of data available with advanced analytics (AI/ML, Data Science, Inferential Statistics), and based on those insights they need to bring innovation in food. Restaurants also need to focus on analyzing the food pattern based on geographies, age, sex, and weather and bring culinary originality to the local food delicacies & delivery.
- Seamless order taking – Restaurants must capitalize on the advancement in cloud technologies. A cloud-based Point of sale (POS/Mobile POS) system can work on different hardware – Laptop, tablet & mobile integrating with 3rd party applications (Zomato, Swiggy, etc.) enables seamless order taking, mobile ordering, table reservations, orders from outdoor diners and automatic loyalty rewards.
- Transformed front-end operations – This is the area where technology can play an important role. Restaurants can enable personalized experience based on digital footprints like order history, food preferences to generate opportunities for cross/up-sell leveraging AI & ML. Self-ordering kiosks leveraging AR/VR technologies provide an immersive experience and allow customers to order food themselves.
- Improved efficiency in kitchen operations – The kitchen, the heart of the restaurant, is waiting to reap the benefits of digital transformation, like an Intelligent Kitchen Display system that can be installed and integrated with POS to help faster order preparation, or Automated inventory replenishment & forecasting, Automation of routine task like billing, scheduling, etc.
- Targeted marketing & better customer engagement – If you are not visible to your customers, you can’t sell, hence the importance of promoting restaurants and engaging with customers. While offline promotion helps, it has limited reach and is very expensive. Restaurants must look for online promotions to increase their footfall. Technology can help drive and measure marketing campaigns, building a user-friendly website, mobile app dev, promotion and offers, loyalty-building, social media marketing, SEO, etc.
I believe this global crisis is an opportunity for restaurant operators to bring their digital house back in order while achieving an edge over the competition through efficient use of technology. Operators need to ensure that they are enabling meaningful experience for the customers along with continuing to serve great food at a compelling price in a timely manner. The National Restaurant Association estimated that foodservice sales are going to increase as we have adopted the new normal, prompting restaurants to act while the opportunity is still fresh, and reap the full benefits of the new digital technologies that are turning the tide of innovation.
How can Brillio help?
Brillio is a true digital partner for creating the ‘Restaurant of the Future’. We understand the unique challenges in the restaurant industry and apply fresh thinking, build amazing customer experiences, and develop innovative solutions through domain expertise, customer-oriented design, product-centric development, all while leveraging Agile execution.