8 Fast Food Chains And Tech Startups Replacing Workers With Robots

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Written by Dana Sanchez
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Startups and long-established fast-food giants alike are finding ways to marry cooking with technology.

Will robots enrich owners at the expense of jobs? The idea that robots will replace workers is so controversial that when companies introduce new robotic technology, they almost always try and do damage control.

Some companies come right out and say yes — robots will cut down on labor costs and increase profits. Others try and control the message, disseminating press releases to the public saying workers will somehow emerge earning more, not less.

In September 2016, nearly 25 percent of restaurant closures in the San Francisco Bay Area cited labor costs as one of the reasons for shutting down operations, according to Forbes.

Proponents for higher minimum wages often claim that it could accelerate robot adoption.

Do you care that robots will be/may already be preparing your food at a fast food restaurant near you? Or that you will be giving your order to a robot? You be the judge.

Replacing Workers With Robots
Miles Donovan

 

Shake Shack

Shake Shack is testing the possibility that machines can handle customers’ money better than humans can. A first-ever cashless, kiosk-only Shake Shack location is scheduled to open this month in New York City’s Astor Place. The technology will allow the kitchen staff to focus on the food and the front-of-house staff to focus on a seamless, frictionless customer experience, Shake Shack CEO Randy Garutti said, according to a CNBC report. Guests will use their mobile phones or digital kiosks to place orders. The kiosks will be manned. But instead of Shake Shack buzzers, diners will get a text message from the restaurant letting them know when their food is ready. The NYC kiosk location will be used to test other digital and hospitality innovations before Shake Shack rolls out kiosks of them elsewhere.

Momentum Machines

 

Momentum Machines

Momentum Machines is a collective of foodies and engineers with robotics and restaurant experience who came up with a machine that makes gourmet burgers from scratch sans human interaction. All the food prep is done by machines. The machine is fully autonomous, meaning it can slice toppings, grill a patty, and assemble and bag a burger with no help from humans, David Kover reported for Serious Eats.
The Momentum Machines startup secured $18 million-plus in financing, according to a SEC filing in May, Business Insider reported. Past investors in the startup include Google Ventures and Khosla Ventures.

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The company has been working on its first retail location since at least June of 2016. The flagship restaurant is expected to be in San Francisco’s South of Market neighborhood. Momentum Machines has done away with the need for line cooks, but will still need front-of-house and custodial staff.

The company told Business Insider in 2012 that letting robots fill in for humans in the kitchen may actually promote job growth because the automation will allow the company to hire new employees to continue developing their technology and to staff additional restaurant locations. The full impact of a robot-powered kitchen remains to be seen.

 

McDonald’s

McDonald’s shares hit an all-time high in June 2017 after the fast food chain announced that new digital ordering kiosks will replace cashiers in 2,500 restaurants, CNBC reported. Other McDonald’s tech upgrades include plans to roll out mobile ordering at 14,000 U.S. locations by the end of 2017. Because of the tech upgrades, Cowen raised its rating on McDonald’s shares from market perform to outperform.

A McDonald’s spokesman sent a statement to CNBC saying self-order kiosks in McDonald’s restaurants are not a labor replacement. At least that’s what CEO Steve Easterbrook has said on many occasions.

“They provide an opportunity to transition back-of-the-house positions to more customer service roles such as concierges and table service where they are able to truly engage with guests and enhance the dining experience.”

 

Wendy Kiosk

 

Wendy’s

Wendy’s said in February it will install self-ordering kiosks at about 1,000 locations by the end of 2017 to combat higher labor costs and slowing growth, NYPost reported.

Kiosks are intended to appeal to younger customers and reduce labor costs, said David Trimm, Wendy’s chief information officer. Customers won’t have to wait in long lines during peak dining hours and kitchen production are expected to increase. A typical location will have three kiosks.

Trimm estimates the company will see a return on its investment in less than two years.

“Younger customers prefer to use a kiosk,” said Darren Tristano, vice president with Technomic, a food-service research and consulting firm. “They are looking to improve their automation and their labor costs, and this is a good way to do it. They are also trying to enhance the customer experience.”

Wait. Doesn’t that imply that humans are bad for good customer experiences?

Fast-food chains like Wendy’s value kiosks because they provide data about customers, Tristano said.

Kiosks are already installed in central Ohio, where the company first tested the technology.

Mobile ordering and payment via smartphones will one day overtake self-ordering kiosks and cash registers, Tristano predicted.

 

Zume

Zume Pizza, a food delivery startup in the San Francisco Bay Area, has pioneered a robot-assisted technique for pressing pizza dough into circles in nine seconds — that’s five times faster than pizza spinning pros.

Robots allow humans to spend time on less tedious work, said CEO and co-founder Julia Collins, according to an interview in The Verge. “We wanted to identify places where humans were overtaxed physically, bored, or whether the job they were doing was not safe, like sticking their hand into a 600-degree oven for six hours a day … That’s why we focused … (on) … the dough.”

The robot, named Doughbot, is now being deployed on Zume’s “robot-enabled pizza assembly line,” which includes various other robots working together with humans in an assembly line-style work space.

In June, Zume hired Susan Alban, who launched Uber’s food delivery arm, UberEats, as its new vice president of operations.

Zume’s ultimate goal is to make fresh, locally sourced food at reasonable prices by aggressively rethinking the costs of running a food operation dependent on delivery.

All ordering is done through the company’s mobile or website. There is no storefront. “So rather than paying 10 percent of sales in rent, we pay 2 percent of sales in rent,” Collins says, while “robots increase our production volume.”

Zume has about 115 full-time employees. Will robots enrich the owners at the expense of jobs?

“Our goal was never to have end-to-end automation,” said Zume CEO and co-founder Julia Collins. “How can we have a pizza production operation that would have no humans?’”

Zume can lay the groundwork for the future of high-quality, tech-infused food delivery that doesn’t treat human labor as an enemy, Collins said. Her company employs only full-time workers, and says it is dedicated to keeping those employees from doing tedious tasks.

“We want to make sure everyone has access to high-quality, affordable food,” she says of Zume’s goal, “and to use technology to solve American’s food problem.” If that mission involves a robot that can press dough or spread sauce faster and better than a human being, can you really blame Zume for being the first to get out there and use it?

Zume is not alone in the Bay Area. Other automated startups are popping up trying to fuse cooking with technology.

Eatsa

Eatsa, which has a number of locations in California, serves quinoa-based bowls made without any human interaction, The Verge reported:

This type of company combines the on-demand ambitions of startups like DoorDash, Munchery, and Postmates with a kitchen technology twist, all with the aim of avoiding the typically heavy costs associated with food production and logistics.

Starship Technologies

Numerous restaurant chains have looked to computer tablets as a solution for rising labor costs that won’t adversely impact the customer’s experience. In a scene stolen from The Jetsons, the Starship Technologies delivery robot navigates the streets of San Francisco with groceries and other consumer goods. The company’s founder said rising minimum wage is a key factor driving the growth of his automated delivery business, Forbes reported.

Yelp and Marble

Yelp is best known for user-generated reviews, but the company began offering food delivery in 2015 following the acquisition of Eat24. Yelp Eat24 offers fleets that can deliver food. Yelp started testing delivery by robot in San Francisco in 2014 in partnership with Marble, one of a handful of ventures developing ground-based robots that can navigate autonomously to a customer’s address, Tech Crunch, reported. Their machines look like a large kitchen appliance crossed with a Mars rover.

Users ordering delivery through the Yelp Eat24 site or app can opt in for robot delivery in specified areas. If they opt in, they get a pin code texted to their phone, which they can use to unlock the robot’s cargo bay when their Marble delivery arrives. After retrieving their food, they close the door and the robot returns to Marble HQ or another restaurant.

Marble gets a per-delivery fee and tips — if people feel inclined to tip. “It’s not likely that people will feel compelled to tip a robot, though,” TechCrunch reported.

Marble has competition from delivery robot makers Starship Technologies and Dispatch.ai, as well as from emerging drone delivery businesses like Flirtey, and established food delivery companies including UberEATS food delivery platform.

Perhaps most importantly, Marble is not a fully autonomous robot. A human chaperone accompanies each delivery robot in San Francisco, according to Harrison Shih, Marble’s head of product.

“That’s partly to tell curious passersby all about their robots, but also to gather community feedback. Additionally, Marble robots are observed via monitors back at company headquarters.”


About Dana Sanchez

Dana Sanchez was born in South Africa and is a U.S. citizen. After working in advertising, she went back to school and earned a master's degree in journalism from the University of South Florida. As a business writer, she won regional and national writing awards. As editor of a daily newspaper, she coordinated staff writers, freelancers and photographers in the fast-paced environment of daily news. Dana was an editor at Moguldom Media Group for four years, helping to build and manage a team of staff and freelance writers. She works now on Moguldom.com for Nubai Ventures. A long-distance hiker and cyclist, she writes about the business of technology.