Robots and restaurants were very much in the news this week. Artificial intelligence guides a robot to handle takeout orders. More consumers are buying breakfast beverages and snacks as people give up remote working and return to their employers' facilities. And McDonald’s has begun market testing a chicken version of the Big Mac. These stories and more This Week In Foodservice.
More news on robots in foodservice with the “Wall Street Journal” covering a robot that doesn’t greet customers or bus tables. Nor does it make french fries or grill hamburgers. This robot answers the phone and uses artificial intelligence to book reservations and handle takeout and delivery orders. The new robot doesn’t get flustered when business gets hectic and always has a pleasant deminer.
Still the tool has critics who think there are some customers who will prefer to deal with a live person for situations like food allergies and special needs guests. There are also unanswered questions about customers with heavy accents and other variations.
Making a major commitment to the new idea is well-known restaurateur Danny Meyer, who has invested $10 million through his investment firm, Enlightened Hospitality, in ConverseNow, which makes voice-bot systems and has its technology in 1,200 restaurants, including Domino’s, Fazoli’s and Blake’s Lotaburger. Meyer, founder of Shake Shack and a host of New York restaurants, has stepped down as CEO of Restaurant Square Hospitality, his restaurant company. He will join the board of ConverseNow.
While it is hard to predict the path robots will take, many in the foodservice business contend that over 80% of the jobs in restaurants could be done by technology. But not all robot applications have been successful. Chili’s has announced they are “pausing” their Rita the Robot system after evaluating various technology projects to determine their benefit as well as the cost and effort. It would seem Rita, which sat guests, delivered food and sang happy birthday, was unsatisfactory in one or both areas. But be sure to note that Chili’s said they were pausing Rita not discontinuing her.
Economic News This Week
- Initial jobless claims fell by 2,000 to 243,000 for the week ending August 20 from the previous week. The 4-week moving average decreased by 1,500 claims. Jobless claims have stayed in a fairly narrow range for the last couple of months indicating that employers are remaining reasonably confident.
- The Bureau of Economic Analysis's second estimate for the real gross domestic product in the second quarter of this year is a decrease of 0.6%. This is a slight improvement over the Advance Estimate of a 0.9% decrease.
- The Bureau of Economic Analysis reported that in July real disposable income rose 0.3% while Real Personal Consumption Expenditures increased 0.2%. The data indicates that consumers’ income is continuing to increase, and consumers are continuing to open their wallets. These are hopeful signs that if we are slipping into a recession, it will be a mild one.
- The Census Bureau reported that new home sales were 511,00 In July. This was 12.6% below June new home sales and 29.6% below sales in July 2021.
- The University of Michigan’s Survey of Consumers showed significant improvement in the final August reading, rising to 58.2, which was up from 51.2 in July. But consumers did not see much to be enthusiastic about at the present as the Index of Current Economic Conditions was 58.6 in August, virtually unchanged from 58.1 in July. But consumers are feeling considerably better about the future of the economy with the Index of Consumer Expectations showing a double-digit increase from 47.3 to 58.0. This rise followed two months of the lowest reading since the great recession. Driving the increase in consumers’ positive outlook was the deacceleration in the rate of inflation.
Foodservice News This Week
- As more people give up their home offices and return to work, they are stopping by Starbucks or grabbing an Egg McMuffin.The NPD Group reports that restaurant traffic fell 2% in the second quarter but breakfast transactions were unchanged.
- McDonald’s will begin testing a chicken version of the Big Mac in the U.S. After what was reported as a very successful test market in the U.K. and Ireland, McDonald’s is selling the chicken Big Mac in a limited number of stores in the greater Miami, Florida area. There are no immediate plans for a nationwide rollout but McD’s did not rule out an expansion. However, while a chicken Big Mac would seem like a natural, the hamburger giant pointed out that a successful test market does not guarantee the product will be launched nationally.
- McDonald’s and other companies are bowing to workers who wish to have access to earned money when they want it.No more waiting two weeks for payday. Generation Z employees are particularly pushing for ready access to what they see as their money. The phenomenon is known as earned wage access or EWA. With the tight labor market that exists in this country, a lot of employers are quite willing to meet this demand.
- Growth Chains: Eatertainment chain Cinergy, which has facilities as large as 90,000 square feet and offers movies, ax throwing, electronic games, also has kitchens as large as 4,000 square feet capable of serving up to 800 meals a day. The chain will open its 10th location later this year.
For the most recent comparable store sales of publicly held restaurant chains, please click here for the latest green sheet.