Automation provides solution for fast-food chains in ‘war for talent’

Flippy the robot, who
flips burgers at a Caliburger restaurant in Los Angeles, could be
a taste of things to come in the fast-food
industry.

Miso
Robotics/YouTube

• Fast-food chains are struggling to hire workers and
  reduce turnover. 
• Now, many brands are turning to robots
  for solutions. 
• “The only way to truly deal with this is to reduce the number
  of labor hours that are required to run your concept,” BTIG
  analyst Peter Saleh told Business Insider. “And, I feel like the
  only way to really do that is to implement technology.”

The “war for talent” might be the spark restaurant chains need to
shift the
industry’s drive towards automation into top gear. 

Executives and analysts alike are bracing for the impact of the
battle to fill positions and hire competent employees in the
restaurant industry. With unemployment low and more options
available to entry-level workers than ever before, many chains
are struggling to hire and retain talent. 

“For some brands, it’s actually capping their sales potential,”
John Hamburger, the founder of industry trade publication
Franchise Times Corp., told Business Insider. 

“If you can’t find enough people to fill a shift, you just can’t
possibly do the potential volume of what some of these
restaurants are supposed to be doing,” Hamburger continued.
“There’s a lot of brands that are having a lot of trouble trying
to find workers.”

A number of chains are trying to beef up their benefits or raise
their workers’ pay in order to cut down on turnover and attract
talent. But, according to BTIG analyst Peter Saleh, there is
just one long-term solution to solve the problem. 

“The only way to truly deal with this is to reduce the number of
labor hours that are required to run your concept,” Saleh said.
“And, I feel like the only way to really do that is to implement
technology.”

These
Shake Shack payment kiosks are powered by Square on the
backend.
Square

Automation can take a wide range of forms at restaurant chains,
including mobile order-and-pay, ordering kiosks, and automation
in the kitchen. 

Shake Shack, Taco Bell, and McDonald’s are all rolling out
ordering kiosks across the country. Arby’s has installed ovens
that automatically roast beef, while Dunkin’ Donuts has roasters
that independently grind coffee,
the Wall Street Journal reports. And, mobile ordering
has become the norm across the industry, with chains from
Chick-fil-A to Starbucks incentivizing customers to download the
apps. 

“It can be a natural support for running the
business,” Dunkin’ Donuts’ then-CEO, Nigel Travis, said of
automation earlier this year. 

If all Dunkin’ Donuts customers ordered and paid using their
mobile phones, Travis said, the chain would be able to cut 30% of
labor in stores. However, according to Travis, Dunkin’ Donuts
franchisees are already struggling to fill open positions.
Automation therefore doesn’t necessarily mean workers would be
fired, but instead that stores would be able to operate even with
current unemployment rates. 

It can also help protect companies’ bottom lines as minimum wages
increase in states across the US. Red Robin and Jack in the Box

both announced earlier in 2018 that they planned to cut
labor costs through automation. 

Saleh says that BTIG is keeping tabs on companies that stay ahead
of the curve by using tech in the war for talent. 

“The labor line is really the killer right now,” Saleh
said.