The first of this two-part series examines customer-facing technology, including dine-in, online and takeaway experiences; changes in the drive-thru; and what’s happening with delivery.

The restaurant industry is being reconfigured and reconceptualized more rapidly than ever before, driven by factors including the pandemic boom in takeout followed by consumers’ enthusiastic return to dining in; an ongoing labor supply crisis; and above all, the dizzying proliferation of technology in both the front and back of the house.

Rolling through the restaurant with bright graphics on the front and drink shelves on the back, Kura Sushi’s KuraBot entertains as it delivers soft drinks to customers. Photo courtesy of Kura SushiIn polling conducted for the National Restaurant Association’s (NRA) 2022 “State of the Restaurant Industry” report, more than 8 in 10 operators said the use of technology in a restaurant provides a competitive advantage. About two-thirds of operators overall also said they expected the use of technology and automation to proliferate in their segment; in the QSR segment, fully 78% anticipated seeing more technology and automation, largely to counter the industry’s ongoing labor shortage.

A large proportion of operators surveyed said they planned to invest in new technology, especially service-based technologies like online or app ordering, mobile payment and delivery management.

Who Goes, Who Stays

Most restaurants currently use some form of technology for back-of-the-house operations as well as administrative tasks like employee management and order capacity and throughput management. Digital payout and better scheduling can increase employee retention. Reservation software and online ordering get more customers and couriers through the door. Digital menus reduce friction for customers and lead to more revenue. Performance analytics help managers allocate staff in a cost-efficient way. But these forms of software assistance don’t directly replace staff members.

The human tasks operators see as easiest to replace with tech tools are mostly peripheral customer-facing roles: drive-thru window staffers, baristas, hosts, runners, bussers, food delivery drivers and cashiers.

Even consumers see less need for cashiers nowadays: Per research from Deloitte, 7 out of 10 diners prefer to order using self-ordering technology rather than ordering from a cashier, primarily because they can take their time deciding what they want.

But in full-service restaurants, the waitstaff — the people who most directly serve the customers by delivering their food and managing the dining occasion — are less automatable, since most customers view hospitality as an essential part of their restaurant visit.

At bartaco, dine-in guests begin by snapping a QR code set into their table, then order and pay via a digital app. Runners know where to bring the order because each table’s QR code is unique. Photo courtesy of bartaco

Technology to Enhance Hospitality

The hospitality offered during the dine-in restaurant occasion has returned to the forefront of what consumers value, says Dave Henkes, senior principal at foodservice research and consulting firm Technomic. “Technology is here to stay,” he says. “It’s going to be built into the restaurant experience in all types of operations.” But customer-facing technology must enhance, or at least not detract from, that hospitality experience, particularly in sit-down restaurants, Henkes stresses.

“QSRs have more leeway to experiment,” Henkes says. “That’s where a lot of the investment will be. The evolution of the industry will favor convenience-driven operators utilizing technology to create
customer experiences.”

1. Transforming Transactions in the Restaurant and Online

Customer-facing aspects of the restaurant experience currently being rethought include food ordering and prepayment (via a mobile app in advance or at the counter or table, or via a kiosk); delivery of food and drinks to tables; ease of takeout and delivery; and the data-mining opportunities associated with restaurants’ loyalty apps.

The New Order

In-restaurant ordering kiosks have been around for years, and they’ve gained wide acceptance from the dining public. In the consumer study done for the NRA’s “State of the Restaurant Industry” report, 61% of restaurant diners said they’re likely to use this technology.

However, the jury is still out on whether kiosks beat either human order-takers or ordering via phone apps. For Juan Martinez, FCSI, principal and co-founder of foodservice engineering consulting firm Profitality, kiosks make sense where and when counter lines are long and staff are overwhelmed. “People want convenience,” he says. “If I go into a restaurant and there’s a line, I’ll go to the kiosk. If there’s no line, I’ll go to the counter.” Capacity analysis — one of the services Profitality performs for its clients — can help determine the right balance between ordering kiosks and traditional POS registers to optimize customer throughput and ROI across dayparts, Martinez says.

The dining public may not even need to utilize restaurant kiosks or tabletop ordering tablets anymore, since almost all of them are carrying around the equivalent in their own pockets or purses. “The ultimate kiosk is the smartphone,” Martinez says.

Unlike in-unit ordering kiosks or tablets, restaurants’ ordering and loyalty apps on diners’ smartphones collect a trove of useful data for the restaurant, Technomic’s Henkes points out. “You can better target promotions, menu add-ons and other sales opportunities; you can target core guests or infrequent customers,” he says. “And that data can carry back through the production process; if you know what customers are ordering, your food waste goes down, you can create more effective LTOs and you buy more effectively.”

Consumers appear to like restaurants’ phone apps just as much as the restaurants do. Per the NRA’s 2022 “State of the Restaurant Industry” report, 8 in 10 adults, and nearly 90% of Millennials and Gen Z, say they would be likely to join a loyalty program offered at a favorite local restaurant. Seven out of 10 say they’d be happy to pay for their restaurant meal on a mobile app.

Mobile phone-based ordering is so impactful that full-service restaurants are now adopting it not only for off-premises orders but also with dine-in customers.

In addition to its test of voice AI technology for drive-thru ordering at larger-footprint units, Panera Bread is pioneering several other configurations, including Panera To Go, a digital-friendly compact urban format with no seating—only shelves where guests and delivery drivers can quickly pick up orders. Photo courtesy of Panera Bread

Guests Manage Their Own Orders

One FSR chain that has embraced QR-code ordering is Arlington, Va.-based bartaco. Kelly McCardle, vice president of information technology, explains the system: A unique QR code is embedded in every table that, when captured with a smartphone’s camera, brings up an ordering and payment app. The first prompt asks who will pay (“I am paying for myself,” “I am paying for myself and others” or “Someone else is paying”). Once the menu appears, diners order without waiting for a host to open a tab. Those who are paying will need to provide their credit card information, which links to a digital wallet. (The chain does not accept cash except in areas where it’s required by law.) Once the party’s order is ready, a food and drink runner brings the food to the correct table.

At bartaco, staff members designated as “service leaders” are each assigned an eight-table section of the dining room, and they interact with customers and explain the system to those who are unfamiliar with it.

McCardle says this system evolved from one meant for QSRs, which closed tickets when the order was placed. Now, tabs remain open, giving diners the chance to add another round of tacos or margaritas to an existing order. “We believe this model elevates the guest and employee experience,” McCardle says. “It has enabled our service to be more guest-focused and allows guests to be in control.”

One key benefit for the restaurant is the information harvested from an online survey offered to each guest who pays a check (with a taco on a future visit as an incentive). “The feedback tells us how well employees are engaging with guests so we can offer a bonus or a shoutout to those who do well, and coaching to those who need help,” McCardle says.

The Robot Runner

In some restaurants, the new way of doing things includes robots to run food and drink orders to diners’ tables. Martinez has done cost-benefit analyses for clients and believes robots can pay off. “In a full-service concept, about 25% of the server’s time is spent walking,” he explains. “Servers can take a party’s order on a tablet and send it to the kitchen; then somebody puts the completed order on a cart and a robotic runner brings it to the table. The servers are still there, but instead of serving three or four tables they can give concierge-level service to seven or eight tables.”

One robot that’s been embraced enthusiastically is the “KuraBot” introduced by Irvine, Calif.-based Kura Sushi. As a conveyor-belt sushi chain, the brand has always focused on technology and continually strives to bring in new and exciting features, says Hideto Sugimoto, vice president of system and menu development at Kura Sushi USA. While the conveyor belt rolls the sushi to customers, it’s now “Kur-B” that rolls the drinks.

“Once our waitstaff receives a notification about a party’s drink order, they place the soft beverages on Kur-B and program it to deliver to the corresponding table,” Sugimoto explains. “The KuraBots also entertain — they talk, light up and play music.”

The addition of the robots means more time for servers to engage and check in with customers, Sugimoto says, so it’s no surprise both guests and employees have reacted positively.

A small-footprint drive-thru-focused McDonald’s is being tested in Texas featuring a separate order-ahead lane. Geolocation technology alerts staff to prepare the order as the customer nears the dedicated drive-thru lane; upon arrival, the customer picks up the pre-ordered food and beverages from a conveyor emerging from the kitchen. Photo courtesy of McDonald’s

2. Driving-Thru Efficiency

Nowhere has the march of automation been more visible than in restaurant drive-thru lanes. Drive-thru patronage increased by 20% between 2020 and 2022, according to The NPD Group, propelled in part by the rise of digital preordering — which more than doubled in incidence over the same period. Now, restaurants are turning to technology to boost customer throughput and convenience.

McDonald’s has been working toward transitioning many of its drive-thrus to self-ordering utilizing voice recognition software and ordering screens. Its most recent test of a new drive-thru format is a small-footprint restaurant in Texas that features a conveyor belt system to deliver food and beverages to a mobile-order-only lane. Inside the restaurant lobby, there’s a pickup area for delivery-service drivers and a pickup shelf for customers retrieving their own takeout orders. For those who haven’t ordered ahead, there are also kiosks where to-go orders can be placed. Several parking spaces are dedicated to curbside order pickup; there are also separate designated parking spaces for delivery drivers.

“The technology in this restaurant not only allows us to serve our customers in new, innovative ways, it gives our restaurant team the ability to concentrate more on order speed and accuracy, which makes the experience more enjoyable for everyone,” says Keith Vanecek, the franchisee operating the test restaurant.

Other chains are finding other ways to reinvent the drive-thru. Taco Bell partnered with its Minnesota franchisee Border Foods to create a two-story drive-thru prototype, with three of four drive-thru lanes reserved for digital preorders and delivery service drivers, screens at pickup that read QR codes to confirm orders, a second-floor kitchen, an enclosed-tube lift system to lower completed food orders to drivers, and an AV link so the drivers can see and speak with the staff above.

Chipotle Mexican Grill’s Chipotlane format fulfills only preorders made through its app, website or delivery services. Chipotle is testing contextual restaurant experience software, which alerts customers who have opted in on its app when their order is ready for pickup; a predictive location system allows the chain to notify patrons if they’re approaching the wrong location rather than the one where their order is waiting.

Panera Bread is testing proprietary voice-recognition artificial intelligence to speed throughput at drive-thru units. And an Arby’s franchisee in California has installed a voice assistant robot to take orders and send them to the kitchen, allowing the operator to reallocate some of the staff to back-of-house duties.

Onward and Upward

“Drive-thru, which used to be very much the domain of QSRs, has spread to any restaurant that believes it will do a significant amount of takeout or delivery-driver business,” Technomic’s Henkes says. “Fast-casual drive-thru has exploded; now, even full-service restaurants like Famous Dave’s are starting to play with drive-thru. If you have the space, it’s a no-brainer — another way to increase efficiency and drive off-premises occasions.”

As restaurant dining rooms and parking lots shrink, drive-thrus are likely to expand either vertically or horizontally depending on what makes financial sense, says Profitality’s Martinez. “In a place like New York where real estate is very expensive, you go deep and go up,” he explains. “But where horizontal space is less expensive, why go up?”

Martinez is convinced that artificial-intelligence voice recognition technology will transform the drive-thru experience — but he’s not sure when. “We all talk with a certain accent, cars all have a certain noise, so there’s a level of complication,” he points out. “But once suppliers get it right, it’s going to be mainstream, not only in the drive-thru but also in the dining room — it can be done anywhere.” Some chains are adding voice recognition for customers ordering at walk-up kiosks or preordering by phone.

The proliferation of high-tech drive-thrus has not killed the walk-up service window, a takeout format well suited to urban areas. Where the restaurant footprint allows, some concepts are opening units with both step-up and drive-thru service. For instance, in 2022 Captain D’s debuted a smaller Express format, a 950-square-foot prototype offering drive-thru service and an external walk-up window but no dining room.

In addition to its Chipotlane drive-thru service, Chipotle has added to its prototype portfolio the Chipotle Digital Kitchen, a smaller unit with drive-thru and walk-up service but no dining room. Now it’s piloting walk-up windows instead of drive-thrus in high-traffic urban areas.

It should be an obvious point, but it’s not necessarily easy to implement: Speeding service and customer throughput has to be done in tandem with speeding food production. “You can build all these lanes for faster service, but if you can’t produce food inside the facility at the same pace, the drive-thru becomes a parking lot,” Martinez cautions. “It all goes back to the engine inside the machine.”

Above Queensland, Australia, a DoorDash delivery drone takes a lightweight package of food or sundries to a customer who has ordered via a digital app; the ordering process includes marking an “X” on an aerial image of the property where the package will be delivered, indicating a place for the drone to land. Photo courtesy of DoorDash

3. Deliver More, Better, Faster

The pandemic and the temporary restaurant closures it necessitated were a turning point for delivery. Young adults now view both takeout and delivery as central to their lifestyles, with 72% of Millennials and 66% of Gen Z calling them essential services, per the NRA’s “State of the Industry” report.

Aided by the rise of mobile ordering apps, location-tracking software and third-party delivery services, delivery sales of restaurant meals more than doubled between 2020 and 2022, according to The NPD Group. With consumers returning to dine-in experiences as the pandemic wanes, the delivery business appears to be plateauing at that new, higher level. Now, restaurants and delivery services seek lower cost and greater efficiency, especially in light of the labor shortage. Consumers continue to resist high costs for delivery, particularly from third-party services.

A restaurant worker loads a meal order into a self-driving delivery cart. Robotic carts from several makers have been a successful delivery vehicle for some college and medical campuses and dense urban areas, but their small range and slow velocity limit them to specialized applications. Photo courtesy of GrubHub“It’s very hard to make money on delivery, even for a big player like Domino’s, which now offers its customers a discount if they come in to pick up their order,” notes Technomic’s Henkes. “If there are options to reduce delivery costs, restaurants will look closely at them.”

One potential option to reduce delivery costs: using driverless vehicles to transport food. Currently, that means self-driving robotic delivery carts, already in operation on college campuses and in urban locations where customer demand is concentrated in a small geographic area.

Both Henkes and Martinez believe going forward, self-driving robots will continue to play only a limited role in food delivery. “If you deliver 10 meals, you have to have 10 different robots, and they don’t move fast,” Henkes says. “The model can maybe work with less perishable foods that don’t need to be eaten right away.”

Self-moving robot carts present several issues, Martinez adds. These include not only slow speed but also uncertainties about unit reliability and ROI (since operators typically must pay monthly fees to the robotics company). And then there’s human orneriness: “People love to hit them when they come by.”

On the Street and In the Air

Delivery services have made no secret of their desire to move on from their driver fleets to self-driven cars. Martinez says robotic carts can work in areas with high density, few streets and little traffic, but for longer distances, he foresees self-driving electric cars, which, he notes, are “less feasible to try to knock down.” And cars can go a much longer distance than carts, and use streets instead of sidewalks.

One company’s autonomous delivery vehicles — tiny electric cars that the maker calls micro-vans — alert people when they arrive at the designated address, where the customer inputs a code on a touchscreen to open the compartment containing the order. Modular inserts allow for transport of both hot and cold foods.

The micro-vans are already in use for Uber Eats deliveries in Houston and Silicon Valley, with plans to expand the program throughout the San Francisco Bay Area. Although it has not yet tested the technology, Chipotle Mexican Grill has made a substantial investment in the same delivery-vehicle company, which “could change the traditional delivery model,” says Curt Garner, Chipotle’s chief technology officer. “We believe consumers are going to continue to seek options and additional access points for how and where they enjoy their food.”

Aerial drones represent another form of delivery technology taking flight. DoorDash is piloting airborne drone delivery of shelf-stable foods in Australia. “Drones create a quick, efficient delivery option for smaller orders and free up ground delivery services for larger deliveries,” according to Rebecca Burrows, DoorDash’s general manager for Australia.

DoorDash’s drone delivery system relies on a mobile phone app on which the customer indicates the exact delivery location based on an overhead photo of the property. (For a home, it might be an “x” on the front lawn.) But other solutions exist when it comes to solving the problem of where to land a drone, Martinez says: “Almost every house has potential landing spots. There are heliports on top of hospitals. The delivery company could give you a pad that you could put down somewhere, and the drone has a code to find it and land there.”

There’s no way to know exactly how food delivery will look a decade down the road, but Martinez isn’t worried. “I’m a strong believer that any technology you’re trying to bring to reality, even if it doesn’t get here as intended, plants a seed that will allow you to move forward with something else,” he says. “There’s no such thing as wasted tech.”