Now, kitchens are still shrinking, but in different ways and for different reasons. It’s a trend that’s taken a left turn into the drive-through lane and is more telling of what appears to be a larger transformation in the industry. Coming Soon: The Shrinking Restaurant Mainstream brands that make up the landscape of QSRs and fast-casuals are downsizing not just the kitchen, but the entire restaurant. As the pandemic accelerated consumers’ migration to off-premises dining, seating has become less important for these restaurant models built on speed and convenience. If they’re not already running delivery-only ghost kitchens out of a converted cargo container in some urban center, they’re unveiling new building design prototypes that sacrifice kitchen AND seating space for multiple drive-thru lanes, curbside pickup, walk-up kiosk ordering and throwback parking-lot dining. Also Coming Soon: The Dine-In Dilemma For the more upscale casual and other dine-in-experience restaurants, a shrinking kitchen is the product of 2020’s shutdown scare. These operators dedicated kitchen space to virtual brands for survival and now that dine-in demand is storming back, they’re faced with a decision to keep the additional off-premises revenue streams going or return their focus to the customer at the table. In any case, the challenges that come with a shrinking kitchen remain, even if they’ve evolved enough to demand a review. Restaurant Service Is Still the Big Challenge In the original blog, the risk was brand erosion. It was about putting too much stress on the kitchen—particularly with the rise, even at that time, in digital ordering and takeout—such that wait times for orders would start to expand. Today, digital technology is more deeply integrated into the restaurant marketplace than ever before. And it’s still evolving at a rapid pace. But is it making it easier to deliver a great customer experience? This recent insight from Restaurant Dive begs the question: •    A report from Oracle finds that increased off-premises business at restaurants is impacting customer expectations for speed of service. Over 20% of restaurant customers are annoyed after waiting two minutes to order at the drive-thru window, which jumps to 70% of customers if the wait is five minutes to order. •    Further, 47% of respondents said they feel like delivery and takeout orders have resulted in longer waits when they’re ordering in person, while 38% of consumers believe dine-in business is less of a priority than digital orders. For the speed-and-convenience operations going all in on digital and off-premises, streamlining those digital service providers as much as possible is key to providing more efficient service. For the dining-experience restaurants, creating a clear operational distinction between dine-in and delivery service—perhaps, even establishing a separate venue for delivery only—is critical. If the labor crunch makes this difficult, it might be time to make that hard decision to drop either the on- or off-premises business. Keeping the Menu Fresh Is More Important Than Ever In 2018, the menu was shrinking too, in part because the smaller kitchen put the squeeze on storage. But the tighter menu has continued to be the order of the day in the face of rising food and inventory costs, labor turnover that has to keep the menu simple and, again, the explosion of takeout and delivery. Today, it’s even more challenging. Because that same consumer who doesn’t want to wait five minutes at the drive-thru also has a shorter attention span for taste preferences. Thriving in this new era takes more menu evolution, which still demands equipment that can fit the space, versatility and durability requirements inherent in a leaner kitchen. But, for those making a bigger commitment to off-premises dining, it demands a smarter strategy to optimize delivery food quality. And, for all segments, the new era also has upped the stakes on limited-time offers. In a smaller kitchen operation, this makes LTO development more challenging because restaurants have to wow their customers without operational extravagance. Finding partners with experience in LTO development becomes imperative and operators must find their sweet spot for innovation frequency and investment. It is possible to get over-extended on projects and, even for fickle customers, it’s also possible to overwhelm your market with too many test items.

So, how do operators respond and thrive, without marginalizing their brand, when labor is in such short supply? Here are 4 measures that can make a difference. 1. Reevaluate the Front of the House Doing so usually reveals where smart sacrifices (those that don’t affect food quality) can be made in the name of service. For example, shifting personnel to the FOH in any way possible can pay big CX dividends. On a shoestring staff, it could be as simple as placing one person within reach of the ordering kiosk or making management a little more accessible by, say, taking on some hosting duties. If already feeling the pull towards kitchen automation—which would be understandable, given cooks and line cooks are the most difficult positions to fill right now—a commitment to FOH service might be the deciding factor. Meanwhile, for some upper-scale or full-service establishments, it might be time to introduce a few self-serve options up front. Consumers are aware of the staffing shortages and the circumstances greatly responsible for them. And, yet, they keep coming out to eat. Providing diners with the tools, such as condiment dispensers, to ensure they get the meal they want is something they can appreciate in this unusual time, even if it’s somewhat counter to the brand image they’ve come to expect. 2. Extend Takeout to Curbside Together with online or mobile-app ordering (one restaurant technology diners universally like), covering the short distance from takeout to curbside can go a long way to enhance customer experience. Even if space is limited to, say, a single spot in the street outside the storefront, it can be a worthy service investment—especially given the desire among operators and diners alike to decrease restaurant reliance on third-party delivery providers. 3. Go Beyond Training Employees. Empower Them. Supported by the data that reflects consumer preference for real people over robotic  programming is the argument that enhancing employee experience goes hand-in-hand with customer experience. Cultivating a team of happy employees, no matter how many (or few) are on the roster, translates to a better CX every time. This is about strategy separate from the elephant-in-the-room challenge of employee acquisition. It’s about empowering the people already on staff. Given the opportunity to think and act, whether implementing their own new ideas for improvement (within brand guidelines, of course) or taking initiative and solving customer-service problems without fear of management reprisal, employees begin to take ownership of the enterprise. And that is absolutely invaluable to any business on a number of levels—including customer experience. 4. Enhance Your Loyalty Program At this point, in the wake of the pandemic, the power of loyalty isn’t lost on many restaurant operators, especially among major chain executives. Nearly half of the industry’s diners are enrolled in at least one loyalty program, while digital orders grew 124% from March 2020 to March 2021. That said, the power pays off even more when the goal is perfecting the customer experience. Personalized rewards, for example—such as a free birthday meal or offers customized to the diner’s menu preferences—inspire members to be 7.5x more likely to refer a friend, 6.5x more likely to spend more for the sake of maximizing their points, and 5.4x more likely to continue spending. (2020 Bond Loyalty Report) And then there’s delivery—another preference not lost on operators right now. In a competitive move against rival McDonald’s, Burger King recently went all in on CX, extending its rewards to delivery orders (through its dedicated delivery service, not third parties) as a direct response to the top demand customers expressed in the chain’s guest feedback survey.

1. Simplify Your Menu During the massive industry shift to takeout and delivery, streamlining the menu was about focusing on foods that travel well and adapting to smaller ghost kitchens. But simplifying the menu has merit in any operation fighting the labor battle. It makes inventory management more efficient and improves meal-prep mastery and speed that can make a big customer-experience difference when fewer hands are on deck. It also makes menu development more efficient. Where the bottom-line impact is more subtle, but no less significant, is at the table. When too many choices can overwhelm patrons, a simpler menu can improve turns and customer satisfaction. 2. Get Your Suppliers on Board The shutdown shock to foodservice has galvanized an industry solidarity and has many E&S manufacturers and distributors being proactive in their efforts to address operator challenges. With labor being the toughest among them, operators should seek out and urge suppliers to focus on solutions specific to manpower. Press for more flexible ordering and delivery scheduling that otherwise seems like asking too much. This is the time when true partnerships are forged. Likewise, when looking at the labor savings of equipment that speeds up the mundane and enables multitasking, give more thought to the comparison of long-term efficiencies against upfront expense. Labor dedicated to excess training or constant maintenance, both often brought on by overengineering, is a price operators can’t afford to pay right now. And staff shortcuts to compensate in those situations threaten to dramatically compound the cost, whether by jeopardizing food safety, food quality or employee safety. Further, impress upon suppliers the need for equipment versatility and durability to minimize recurring new purchases. 3. Automate (without going full humanoid) While the likes of White Castle and Spyce Kitchen are turning to robots, these chains are what are known as early adopters. Apart from the investment itself, it’s the fear of dehumanizing the restaurant experience that makes most operators hesitant about implementing robotics. The truth is automation takes many forms that improve customer experience while simultaneously saving labor. Software applications on both the ordering and cash-out side represent what many consumers want and, in this labor-crisis era, might simply prove necessary. Meanwhile, similar advances in areas that don’t involve customer engagement—from preprogrammed cooking in the kitchen to administrative software to cleaning technology—can pay huge labor-saving dividends and, more important, free your people to perform and serve your customers better. 4. Be a Retention Hawk This is a bit of a cheat on the title of this blog because retention is really aftermath recruiting—at least, it should be—meaning it must become a much more active pursuit. The no-brainer that comes out of all the data on the cost of hiring versus retaining a restaurant employee must now take more thinking and more outside-the-box solutions in all relevant areas, from training and communication to culture and benefits. Ultimately, it’s about being proactive before the crisis gives workers negotiation leverage—and not just by offering more flex time or compensation. For most employees, it’s about sincerity in one’s appreciation, expressed in dollars or even just verbally.

So, what’s next?Naturally, as takeout, delivery and grab-n-go become even more prominent, we can anticipate the equally strong consumer demand for healthier foods to invade the format. Here are 5 important considerations for making the most of the healthy to-go opportunity. 1.   Understand What the Healthy Demand Is All About Largely driven by the Millennial segment, the “healthy” perception is generally not about abandoning foods, say, high in fat or sugar. It’s about choosing higher-quality versions—specifically, foods that are more natural and less processed, with clean ingredient labels. In the pandemic-inspired return to more comfort foods, that can expand your menu beyond kale and quinoa—even for the long haul, as 69% say they’ll likely continue to eat the comfort foods that they rediscovered this past year. 2.   Make Fresh Faster Kitchens that thrive will be those able to migrate further toward new habits and investments that make ‘fresh prepared’ more efficient. Achieving this can involve everything from optimizing kitchen space, particularly in the midst of delivery-only and ghost-kitchen operations that demand a leaner layout, to better inventory management (#5 below) and maintaining shorter menus. The best part about attacking this faster-fresh aspect is how it can present opportunities for other efficiencies in the healthy-meets-convenience demand—such as equipment that simultaneously speeds up food prep, while also supporting root-to-stem usage and controlling portions. 3.   Simplify Flavor Expansion Operators don’t have to fully commit to meal-kit type offerings (though, that’s yet another trend getting legs right now) to turn takeout packing arrangements into a new opportunity. Packing condiments, dressings and sauces in “on-the-side” containers separate from the rest of the to-go order is key to optimizing meal quality while in transit. Hidden in that is an opportunity to expand beyond your traditional ketchup and mustard to introduce new, healthy, house-made flavors that can wow the customer, even when it comes to takeout and delivery’s more conventional best sellers. 4.   Adjust Your Menu for the Road For operators who have been able to resume dine-in, many have developed separate to-go menus, as they’ve come to identify foods that travel better than others. And there are plenty of sources to offer insight on this. In addition, some other quick-hit ideas to keep in mind include: Food holding is critical—whether hot roasted chicken or a cool meal bowl—especially when to-go order volume is part of maintaining delivery-route efficiency. Healthy merges with grab-and-go beautifully in the form of sandwich wraps, sushi rolls and other similar “no-utensils-required” menu items. Order and stock well-known branded prepackaged items you can add as ingredient complements to a meal. Think Blue Diamond nuts for upscale salads. Explore packaging options that are being developed in real time, as part of the innovation happening downstream in this foodservice shift. Consider new ideas in insulated materials, as well as designs that seal well and keep foods stabilized, with hot and cold foods separate. And, for self-serve, grab-n-go applications, look for packages that merchandise much better than your Styrofoam clamshell. Finally, like the healthy movement, the demand for greener restaurant operations is another pre-Covid trend destined to reemerge in this next phase of off-premises dining, with consumers demanding takeout carriers that are more eco-friendly. 5.   Healthy To-Go Profits Call for a Leaner Pantry Improving inventory management is always wise, but becomes even more paramount in this new era. Having a tight, data-centric handle on what’s moving through your kitchen is about reducing costs and optimizing the freshness so critical to high-quality, healthy food deliveries. Another proactive solution that goes hand in hand with this effort to reduce food waste is a steady roll of limited-time offers (LTOs) featuring crafted foods from on-hand ingredients.

1. ‘Six Sigma’ Kitchens Under the Pressure of Fresh Wibel: Consumers’ restaurant spending, especially as a percentage of their total food budget, is hitting an all-time high this year. Meanwhile, their demand for fresher foods continues to ratchet up. To keep pace and maintain margins, operators really have to take a page out of our book as a manufacturer and begin to think in terms of ‘lean manufacturing.’ One aspect of this is what, in our world, we call J.I.T., for “just-in-time” delivery of components to keep production as efficient as possible. Well, moving from precut and packaged ingredients to fresh, while it can be a big labor investment, it doesn’t have to be. Considering fresh produce is actually designed by nature to maintain a longer shelf life over precut, with the right prep equipment, fresh can really become a J.I.T. model of efficiency. Carcione: Fresh will force operators to examine every detail of cost control in ways many of them haven’t before. To Michelle’s point, labor will be a major factor, as it always has been, with respect to more efficient prep and cooking. But, now, we’re talking about details in kitchen layout. Literally, the steps employees are taking. We’re talking about cleanup and maintenance procedures. But, also, back on the equipment side, operators will have to find ways to more tightly control food costs by preventing waste that may occur through over-portioning or as a result of discarding foods that weren’t held at correct temperatures, whether hot or cold. And, because of this movement toward fresh, inspectors are getting even more critical of food holding. 2. Off-Premises Dining Becoming a Do-or-Die Scenario Carcione: Takeout and delivery is no longer an added revenue-stream option. It’s got to be part of your business model. I mean, now you have ghost kitchens. So, operations need smaller and more versatile equipment that can keep kitchens lean and nimble. Plus, because speed of service is even more crucial in an off-premises model, equipment purchases should also emphasize performance reliability or backup planning or both to stay immune to any kind of equipment downtime that can dent the brand or maybe even be business fatal. Operators will also have to look at workstations designed specifically for delivery/pickup, with modular options for heated, chilled and ambient holding. And, rather than hand orders to customers when they arrive, some might use a locker-type model of holding where they’ll text the customer a combination to his or her order. So, they’re running takeout without any customer interaction at all. Wibel: What’s interesting about this trend is the mobile-app generation has a lot to do with the growth. But these same folks are also the ones leading the charge for more food ‘experiences.’ So, why is eating restaurant food at home now preferred? Well, convenience is a big part of that. But I also suspect it has something to do with expectations. Are restaurants giving consumers an experience that makes leaving the house worthwhile? For many operators, there’s an opportunity to make the restaurant more of a destination that brings business inside the building—either by offering menu items not available for takeout and delivery or just a really unique, fun dining experience. 3. Value Brands Creating an Equipment-Buying Quandary Carcione: As the industry sees more lower-price equipment options coming in from offshore manufacturers, many of which are improving in quality compared to what has historically been produced in that part of the world, there are a couple of things to keep in mind. The quality differences are still there, but they’re not as obvious on their face. So, depending on what operators need or expect, the purchase decision should involve a little more investigation. Second is the trade war and the pricing fluctuations related to it. Even with the most recent signs of some movement towards a possible agreement, there is still quite a bit of uncertainty around the issue. It could take a while to unfold this next year and, being an election year, anything could happen. So, dealers and volume buyers might ask suppliers about their sourcing capabilities beyond China. Wibel: Adding to Joe’s comments about the quality differences and the buying decision, the improvement of imports is such that they now round out a true good–better–best scenario on the dealer’s shelf, which means operators now have options that can align with the appropriate scenario they might be facing. For operators who are on a razor-thin margin or are facing a more uncertain future—like, say, a startup or an independent that’s trying to compete in a saturated market—a less expensive, ‘good’ import might make sense. For other operators, especially chains, the value proposition is not a lower initial investment, but buying once and using the same piece of equipment for years to come.

1. Consumers Want Fresher Foods While this colossal movement has been pervasive throughout the entire food industry for several years, it continues to impose ripple-effect changes that are somewhat new. For instance, the depth of the demand has kitchens not only changing menu items, but also switching out afterthought staple ingredients for those that now introduce food-holding requirements. A shelf-stable artificial strawberry syrup, for example, is being replaced with a natural strawberry juice that requires refrigeration. In some cases, it might not present a major challenge. But, in others, particularly where conventional refrigeration is out of the question—like self-serve—it can create difficulties. And why is self-serve or, more broadly, consumer point-of-use so important? 2. Consumers Want More Food-Customization Options If one half of the broader consumer demand for “dining experiences” is continuously evolving menu innovation, the other half is hands-on customization. Technomic saw this coming on quickly in 2016 when its report, Trends Shaping Foodservice Through 2020, cited that “72% of consumers expect DIY options at restaurants.” Whether it involves patrons building their own pizzas, salads and sandwiches, or simply adding house-made and other unique condiments and dressings to their plates, satisfying this DIY flavor diversity can’t happen without a mix of chilled options. Neither, of course, can it happen (not efficiently, at least) without self-serve concepts that, for chilled-food holding, create unique challenges—which, incidentally, are about to get tougher . . . 3. Health Departments Are Going Cold on Conventional Ice Baths Even if a chain or operator is all in on serving the customization craze, it’s often a bite-the-bullet decision, because it calls for holding chilled foods on open ice—a notorious maintenance nightmare scenario, even for reliable staff. But here’s why it’s becoming an even bigger issue. These same trends that are moving the industry toward fresher foods are also sharpening the health inspector’s eye on food-borne illness prevention. And that means they’re getting even stricter about holding consistently precise food temperatures. If ice baths were already a major maintenance pain, the pressure is intensifying. And effective alternatives that are a practical fit in a self-serve space are difficult to come by. Operators who understand these market forces can see the related challenges as opportunities and leverage them to strengthen their own brands in a hyper-competitive foodservice industry.