EMV, mobile ordering upgrades challenge restaurant industry
Matt Tourney of CDW, left, and Mike Lyman of MenuPad field questions during the NRA show.
Editor's note:This article originally appeared on Kiosk Marketplace, a Mobile Payments Today sister publication.
Technology exhibits dominated much of the trade show floor recently at the National Restaurant Association Show in Chicago, presenting a host of challenges to foodservice operators who have already invested in point-of-sale systems and other IT infrastructure.
Foodservice operators need to adopt new technologies to be competitive in a rapidly changing market, but determining which to invest in requires a thoughtful assessment of their company's needs.
Traditional technologies included POS and integrations of loyalty and rewards, inventory and payroll; new needs include payment security, food safety, digital advertising, product management, analytics, digital signage and customer delivery.
The most pressing need for most operators is meeting consumer demand for online and kiosk-based ordering according to Michael Lyman, director of business development at MenuPad, a provider of interactive customer experiences.
In a session on transforming the foodservice experience for diners, Lyman shared the stage with Matt Tourney, team lead for IoT and digital transformation, and strategic solutions and services at CDW, an information technology solutions provider.
Integrating online ordering and self-order kiosks can improve a foodservice operator's visibility to customers, reduce operating costs and minimize payment fraud, Lyman said.
Self-order kiosks 'exploding'
"Interactive kiosks have exploded in the past year," Lyman said, adding that the benefits of self-order kiosks include more impulse purchases, fewer order errors, suggested item pairings, larger tickets and lower labor costs.
Self-order kiosks also can provide information about food allergies, a growing consumer concern.
"That information is available to [consumers] right now at the table," Lyman said. He noted that self-order kiosks can also sell gift cards, enable charitable contributions and email customer receipts.
Operators who implement EMV pay-at-table typically see an improvement of nine to 14-minutes in table turn time, Lyman said.
"That's enough to squeeze in two, three or four more tables," he said.
EMV chargebacks challenge operators
While the trade show floor displayed a large number of mobile payment and self-order kiosk solutions, Lyman said fraudulent payment remains a major issue that many operators are not fully aware of. Fraudulent payment poses a liability for operators who have not migrated to EMV-compliant payment systems.
Financial institutions are levying chargebacks against restaurants that are not enabled for EMV transactions, Lyman said. Banks will reverse the charge with no recourse by the restaurant.
"[Chargebacks] are growing more than they're shrinking," Lyman said. "The operator is the person stuck with the bag unless they have an [EMV-enabled] card reader."
Integrating with existing POS
Foodservice operators already using a POS system need to be able to integrate new technologies with it. Fortunately, technology providers have introduced solutions that make this easier than it used to be.
"There's been a dramatic improvement in APIs that integrate with the POS systems," Lyman said. In addition to APIs, cloud solutions have also enabled operators to conduct more functions with less computer hardware.
Interfacing the content management system with the POS is key, Lyman said. This allows the operator to make use of new capabilities, such as mobile ordering and self-order kiosks, while capitalizing on an existing investment.
Both speakers suggested that operators introducing new technology should do a 90-day test to measure business metrics.
"Focus on the metrics and the mechanics," Tourney said.
Assess existing IT infrastructure
Tourney said that operators should evaluate their existing technology infrastructure to make sure it will support new technology. This means having secure Wi-Fi connectivity and internet service.
"Marrying the changes to the business, you've got to have the infrastructure behind it," he said.
The issue of unreliable Wi-Fi was raised during the question and answer session. Tourney said that a lot of equipment in a foodservice business can interfere with Wi-Fi signals, and that an engineer can determine where Wi-Fi signals are being blocked.
When introducing technology that depends on Wi-Fi, the operator has to determine what areas need to access Wi-Fi. A floor plan can be changed to improve Wi-Fi access.
"Operational changes are required very often for you to have a successful pilot," Lyman said.
The speakers summarized the three key takeaways: Firstly, technology can improve revenue, operating efficiencies and competitiveness; Secondly, many new technology products will integrate with legacy POS systems, allowing them to extend beyond core functionalities and meet new operator needs; and thirdly, the operator must prepare, plan and adapt.
One challenge operators often encounter is employee resistance to change, the speakers said. But, they agreed, experience has shown that once technology has been successfully introduced, employees support it.
Tourney added that younger employees tend to adapt to new technologies more easily than older ones.
Elliot Maras Elliot Maras is the editor of KioskMarketplace.com and FoodTruckOperator.com.