Autonomous cars, supply chain transparency and other advances shaping the food business in 2018
In 1948, two brothers revolutionized the food service industry in an attempt to address to more fast-paced life styles, increase efficiency and boost revenue. First, they ran the data and found most of their profit came from hamburgers. So, they simplified the menu to focus on that item, potato chips and apple pies, according to author Bill Bryson.
But the real innovation was more conceptual than that. Brothers Maurice and Richard McDonald saw their kitchen for what it truly was: an assembly line. In 1952, they purchased a new building that would both catch the eyes of passing drivers and give them the space to create a clean, extremely efficient, standardized process for preparing meals. That single innovation, some 70 years ago, continues to inform the business of quick service restaurants and fast casual food retail in important new ways. Here’s a look at three other innovations that promise to shape the restaurant business in 2018.
1. The integrated supply chain in the contemporary modern kitchen
The integrated supply chain of food covers a network of vendors, manufacturing centers, warehouses, distribution centers and restaurants that raw materials move through, and are changed to meet the needs of the final consumer. The complexity of the food supply chain has grown enormously since Maurice and Richard McDonald’s day, but what remains critical is data. Data informs decisions at every successful food retail operation.
Gone are the days of a burger, chips and an apple pie as the main menu. Today large QSR restaurants can have a dozen different cheeseburger choices on the menu, 13 different sides to choose from, a half-dozen salads and 18 drink choices. And then there are the seasonal coffees, short-term signature sandwiches and other offerings that come and go. This food and drink comes from many different parts of the country, and depending on the operator, even the world. Connected restaurant real-time data provides operators information on everything from food costs to cross-unit operations managers and owners need to make strategic decisions, spot trends, identify issues and reward successes.
At Panasonic, data is at the heart of what we call the “connected restaurant.” This covers not just assembly line technology with conveyor belts that move food as workers prep. It’s a digital overhaul that includes connecting all parts of the restaurant to provide data analytics that promote a better operation. Software ties together disparate functions, collects and interprets data and sends out alerts to quickly inform restaurant operators of things going wrong, and right.
2. Transparency in the food supply chain
Food safety and quality has always been important to restaurants; what’s changing is the attention that consumers are paying to the topic. Social media, education and government regulations are helping to drive interest. “In 2018, expect to see transparency and traceability for all, regardless of their income,” predicts market intelligence agency Mintel. In other words, patrons will be able to learn just about everything they want to know about a food’s origins, ingredients and nutritional information. One example: Independent Purchasing Cooperative (IPC), a SUBWAY franchisee-owned and operated purchasing group.
Focusing on the “Fresh Forward” theme, IPC has for several years worked to achieve the full traceability of suppliers' products as they travel from their source into SUBWAY restaurants, according to a recent article in Modern Restaurant Management. “Knowing exactly where a specific lot code of food product is in the supply chain is our goal. If a product is a risk to our brand, and our customers, the benefits of adopting the use of standards are immeasurable,” Dennis Clabby, IPC’s executive vice president, purchasing, told the magazine, highlighting a view that will accelerate across the industry in the coming year.
3. QSR in the age of autonomy
New technology and pilot projects have generated incredible interest in autonomous vehicles. Developments range from driverless cars navigating city streets in the U.S., Japan and Europe to announcements of advanced technology that will speed developments in both autonomous vehicles and smart infrastructure. These developments are pushing automakers to rethink the business of buying and selling vehicles, and the same developments are expected to reshape retail, restaurants and other industries.
As cars start talking to cars and road infrastructure, it’s not a stretch to imagine a car communicating with a restaurant. Here’s how it might work: A vehicle’s infotainment system uses beacon technology to connect to the restaurant’s operations center. The restaurant accesses data on the purchasing characteristics of the vehicle so that, when this vehicle arrives, the system knows that its occupants typically order two double cheeseburgers, fries and a soda. Already major restaurant operators are rethinking the future of the drive thru.
To understand the future of quick service restaurants and fast casual establishments, tech companies such as Panasonic not only invest in in-house innovation, they also devote considerable time evaluating, testing and supporting nascent entrepreneurial ideas that could be fundamental to not only future driverless cars, but also the food business. In this scenario, tech leaders take on a much greater role as third party ecosystem managers which involves code sharing, open innovation and other partnerships. The beneficiaries are consumers who gain customized and fast service they’ve come to expect while allowing owners to increase revenue and efficiency.
Matt O’Connor is the Senior Vice President Food Service & Retail Solutions Group at Panasonic Corporation of North America.