Much has been written about the effect that self-driving cars and trucks will have on the transportation industry. About 3% of all American workers drive for a living. Tech companies like Google and Uber are developing fully autonomous cars, and major car companies (ie; BMW and GM) are deploying auto-pilot and driver-assist features which can control a car in more limited ways. Knowing this, it is reasonable to expect these self-driving vehicles to be available to the masses within the next decade. With driverless transportation, delivery companies like Fed Ex could save tremendous amounts of money on labor if their trucks could make deliveries without a human driver. Further, drivers who shuttle passengers from parking lots to the airport could essentially be replaced with self-driving busses, and Domino’s Pizza would substantially raise their bottom line by delivering pizzas with a self-driving cars or drones.
The US Department of Labor shows that, since the Great Recession, labor costs nationally are rising. Over the past ten years, US non-farm related labor costs have increased by 12%. In fact, accounting firm BDO recently reported that restaurant labor costs are increasing faster than average due to “Intense competition for employees, coupled with overtime regulations, health care costs and increases in the minimum wage…”
There are four things a business can do when faced with higher labor costs. First, businesses can simply idle and absorb the increased cost while decreasing its profit margin. Next, businesses can increase menu prices and hope their customers will pay these increased prices rather than visit a less expensive restaurant. Third, businesses can find savings elsewhere like sourcing and purchasing less expensive materials. Lastly, businesses can find ways to use less labor by either increasing the productivity of existing workers or by automating some of the work formerly performed by people.
Restaurants have small margins, tons of competition and generally need to provide an excellent product in order to compete. Will automation help restaurants reduce costs? Or will new automated food service options disrupt the traditional restaurant business?
Perhaps since the invention of the car, and until just a couple of years ago, offering delivery from a restaurant was a labor-intensive proposition. In-house delivery drivers were standard I-9 employees for whom the restaurant would pay payroll taxes, unemployment benefits, mileage reimbursement and shift meals. A restaurant delivering hot wings on Super Bowl Sunday may not have enough drivers and the day after may lose money even while having just one driver scheduled.
Postmates, Uber Eats and other similar services use the internet to connect people who want to make some extra money using their own car with the restaurant who needs its food delivered. By creating a large network of people with some clever computer coding the number of drivers can increase and decrease as needed. An Uber driver could drop you off from the airport for one trip and then pick up your Pad Thai delivery on the next. With enough drivers on the network it just becomes about proximity. The restaurant pays a fee to Uber, but for that fee, no longer needs to employ a delivery driver, pay the drivers benefits, gas, or shift meal costs.
Postmates and Uber are now using their network of drivers to create a more efficient way of delivering restaurant meals, but this is just the beginning. Uber imagines a future where a restaurant delivery may be completed by an Uber-owned, self-driving car or, perhaps when you’re not using it, your own self-driving car backs out of your garage and makes deliveries for which you are compensated. If you already do a great deal of delivery service and are worried about the coming need to buy and maintain a fleet of airborne delivery drones, don’t worry! Uber and Amazon both have plans to offer this as a service as well.
How will other aspects of the restaurant business be automated? Most of the 600,000 restaurants in the US and Canada manufacture and serve food in much the same way as they have since the 1940s. Raw materials are delivered through the back door. Prep cooks slice and dice the food. Cooks mix and heat the prepped food. In the front of house, waiters or cashiers take the orders and serve the food.
Will the existing restaurants add automation or will they be replaced by new, automated food service? Currently a number of food service concepts are in development which are built around some type of robotics or automation.
|Momentum Machines Burger Machine|
Statista reported that, on average, every coffee shop in the US employs 9.7 people which is up slightly from ten years ago when the number was 9.5 people. Globally, Starbucks employs about eight people per store.
Café X is a robotics company which has raised about $5.1 million dollars to develop what they call a Robotic Café. The first Café X was also launched in San Francisco this year. Using Clover organic milk and Pete’s Coffee, Café X is not like the coffee machine at the hospital. A robotic arm interacts with various machines to make about 120 coffee drinks per hour. Each Café X employs one person to answer questions and promote the café. Limited additional labor is required to clean and stock the machine.
Zume Pizza in Mountain View California uses robotic arms to top and sauce pizza dough. Now, they are working on technology to automate the entire pizza prep and baking process. If you order from Zume, your pizza will leave the restaurant raw and be baked in an oven on the delivery truck. With a very cool use of GPS technology, the oven switches on and begins baking when the truck is designated to reach your address within the time it takes to bake the pizza. Your pizza arrives hot out of the oven regardless of traffic or how busy the restaurant is.
Café X, Momentum and Zume are technology companies that are also building their own food and beverage brands. This is the new wave of automation in the restaurant industry. So, when will you be able to buy a robot for your kitchen?
If your restaurant menu has thirty items on it, with the current technology used for Zume Pizza or Momentum Machines, you would need nearly thirty machines to automate your kitchen. There are just too many variations in products, recipes, and item locations for robots to be effective in a commercial kitchen.
Moley Robotics in London is a company taking steps to deliver a robot chef to the home. 3D cameras film a chef cooking a dish. Then, multi-jointed robotic arms with hands duplicate the motion of the chef to reproduce the recipe. They believe this technology has a commercial application in the future.
Many restaurants have an industrial food processor called a Robot Coup. This machine can be used for mixing, chopping, and making soups. It is not a robot, but it may owe its name to its slight resemblance to R2D2 from Star Wars. When thinking of robotic automation in restaurants perhaps the developers of Robot Coup were a bit prescient. We are certainly a very long way from seeing machines that can replace line cooks, bartenders or even prep cooks working in full service restaurants. However, we may be closer to a future where restaurants will own appliances with robotics which can be programmed. Imagine a prep cook taking a box of potatoes from the walk-in and putting them on a prep table. Some robotic arms may be attached to the table which will then begin peeling and slicing the potatoes for french fries. Once the robot has completed cutting the fries, the cook places a box of green beans in reach of the arms and the arms will peel off the end before moving on to cleaning shrimp, slicing limes or any other repetitive task. Perhaps another set of robotic arms could be placed on the line making some simple high volume dishes. Like the Robot Coup, the robot would be an appliance used by the cooks to increase productivity.
Will the future of the restaurant industry be like what we have today augmented with automation or will restaurants change and be built around automation? Will traditional restaurants find a competitive advantage in their use of real people or will guests favor the less expensive choices provided by automated restaurants? Will new tools be available to full service restaurants which will allow them to replace workers with machines completely? All we know is that it seems we will see more technology companies entering the restaurant space using new machines and tools to create and serve food using less labor. Beyond that all we know for sure is robots in restaurants will know how to use knives.