Making Dollars and Sense out of Foodservice Automation
Tom O'Brien August 02, 2021
Whether it's a piece of robotic equipment or a more technologically advanced piece of traditional equipment, foodservice operators weigh the pros and cons in terms of staff time and ROI before purchasing.
Mention the term "automation" and a couple of pop culture images might spring to mind: perhaps Charlie Chaplin getting squished between the cogs of some gigantic factory machine or a future complete with the robotic maids and flying cars of "The Jetsons." In reality, the future looks less fantastic (and a lot safer) than either of those options, with automated equipment — either robotic or sophisticated traditional equipment — helping foodservice operators run their businesses more efficiently with less labor.
To really see the benefits of automation, operators need to think outside the robot box, says Tarah Schroeder of Ricca Design Group.To really see the benefits of automation, operators need to think outside the robot box, says Tarah Schroeder, executive principal with the Ricca Design Group in Greenwood Village, Colo. "Automation isn't just all robots or artificial intelligence. To me, automation is a system that reduces human intervention in a process," she says. "It takes a task that had to be done by a person manually and makes it happen automatically through technology." By that definition, there are already many pieces of equipment available that can take the human element out of the equation, such as programmable, multifunctional combi ovens.
Juan Martinez, principal of Miami-based consulting firm Profitality, points to the french fry dispensers used in fast-food restaurants as an example of automatic machines that reduce back-of-the-house labor while improving consistency. "It's a refrigerated cabinet in which you put french fries," he says. "Then all you have to do is bring the bag inside, dispense and put them in the fryer." The automatic dispenser relieves the crew member of the repetitive task of loading fry baskets by hand, dispenses a consistent amount and also lets the operator increase or decrease the amount of fries in the basket as necessary.
In some ways, customers seem more comfortable with automated systems in foodservice than operators, due primarily to their experience with kiosk-based or online ordering systems. Warren Solochek, principal of Insights to Opportunities in Chicago, sees a benefit to automated ordering systems that goes beyond merely taking orders. "Making it a more seamless process from a consumer point of view is huge," he says, "which is one of the reasons third-party delivery companies have been so successful. They've automated the process for operators, and that becomes a labor-saving process." That should also lead to increased customer satisfaction through fewer ordering mistakes, he adds.
Under Robot Control
Warren Solochek of Insights to Opportunities Inc. sees a benefit to automated ordering systems that goes beyond merely taking orders. "Making it a more seamless process from a consumer point of view is huge," he says, "which is one of the reasons third-party delivery companies have been so successful."To see how a fully automatic machine works in foodservice, one need only go as far as the nearest college campus or hospital. At many universities, it has become a more common sight to see delivery robots zipping around campus and dropping off food orders. In some healthcare operations, robots handle a variety of tasks, including patient meal delivery, returning dirty trays to the kitchen and even handling laundry pickup and drop-off during slack times.
Pure robotic equipment, which eliminates the human from the food production process completely, has made some inroads into prep areas. Automated salad-making robots, burger-grilling machines and coffee brewers have all been introduced to the market in the past few years; often, they replace vending machines in high-traffic areas (like airports) or places that need service 24/7 (such as healthcare). But true robotics remain a niche area in foodservice, partly because of the high cost of equipment.
"Robots are typically more dexterous than automated equipment," Martinez says, "but are also typically more expensive." To Solochek, it's a trade-off that not every operator might be willing to make. "Operators are looking at their cash flow day to day," he says, "and if you have to make a big investment up front in a robot, you can take that money and get several people's salaries paid over a fairly long period of time."
But Schroeder believes that in a post-pandemic business environment, operators are more willing to try new technology. She recommends operators "go in eyes wide open [and] understand the benefits it can bring, but also know the potential pitfalls."
One of the challenges with robots is the fact that, even with the most sophisticated machines, humans can never totally be out of the system. Doug Huber, principal of Foodservice Consultants Studio in Henrico, Va., points to a coffee chain that uses robotic arms and superautomatic coffeemakers to produce its drinks. "It still takes a human to put the beans and the cream in there," he says. With robotic equipment, staff may need additional training on machine operation, Schroeder adds. "And in some instances," she says, "[the operator] might end up having to create a new position for somebody who does the maintenance."
Juan Martinez of Profitality points to the french fry dispensers used in fast-food restaurants as an example of automatic machines that reduce back-of-the-house labor while improving consistency.While most of the robotic equipment in foodservice today has been in the front of house, opportunities exist for this equipment in back of the house as well. "We're now in conversations with some clients who want to look at using a salad-making robot in the back of house to potentially automate some of the food prep or some of the grab-and-go prep," says Schroeder. "I think that's a perfect example of a piece of equipment that has been so successful that people are looking at where else they can use it."
Humans working in tandem with robots would seem to be the more likely scenario for the near future, says Solochek. "Thus far, automation has only been programmed to do a very specific set of routines," he explains. "Whether it be human being or robot, if there's a need for more versatility and you have to be able to think on your feet, the computerized equipment is never going to win."
Martinez agrees, stating that "humans are the most flexible and adjustable machine around."
And while Huber credits robots with having a "wow" factor that can be intriguing to diners, "I think you still need that face-to-face human touch," he says. "If I went into a casual dining restaurant, spoke to the server and the server went to the kitchen and brought back a plate of food, I wouldn't know whether that plate of food was put together by robots or human beings. But the interaction — the whole experience — was with a person. I don't think robotics is going to take that place."
Deciding whether to buy equipment that's more highly automated takes some analysis on the part of the purchaser. Basic economics can often define if automated equipment makes sense for a particular process, with the classic consideration of fixed versus variable costs coming into play, says Huber. "Automation transfers costs away from labor and into the machine, which means it transfers variable costs into fixed costs," he says. "That means your break-even point goes up, but once you attain that break-even, then your profitability goes up. Sophisticated operators will consider whether the transfer of costs makes sense."
Those economic considerations become even more important given the possibility of increases in basic wages, Huber adds. "If you go from an average hourly wage of, say, $12 to $15, you've got a 25% increase in your labor costs right there. If nothing else changes, that changes the dynamics of your fixed costs and variable costs."
Basic economics can often define if automated equipment makes sense for a particular process, with the classic consideration of fixed versus variable costs coming into play, says Doug Huber, of Foodservice Consultants Studio.Schroeder believes that automated equipment becomes most beneficial when it addresses tasks that can be classified into the "4 Ds." This theory, frequently discussed in articles about robotics, says that automated machines best handle tasks that are dull, dirty, dangerous and dear (as in, expensive). The first two Ds are obvious in the many repetitive prep and cleaning jobs in foodservice, she says, and an example of a dangerous job that can be handled by automation is the replacement or removal of fryer oil. And by eliminating cashiers and servers, equipment such as vending machines covers the final D.
However, Martinez cautions that the time saved by automatic machines must be offset by reduced employee time. This is especially true for back-of-the-house tasks, as in the case of a machine taking over prep work previously done by a crew member. "You did it by hand before, and now you do it with a slicer/dicer," he says. "All of a sudden, you save a half hour of labor by doing this. The prudent thing to do to have a return [on investment] is to bring that individual into the schedule one half hour later. If you don't bring him in a half hour later, then you won't see the savings."
Those savings, Martinez says, can be easily calculated to get a clearer picture of the ROI. "Saving a half hour labor every day at $15 an hour, I'm going to be saving $7.50 a day," he says. Multiply that $7.50 for each day the operation is open in a year, and a $5,000 piece of equipment is virtually paid for in two years. Unfortunately, he says, "I don't believe a lot of operators go through the process of calculating and analytically and objectively applying the labor savings that automation could deliver."