The Taste of

The Taste of Technology

As with all other areas of the store, technology is playing a bigger role in foodservice By Melissa Kress

OVER THE PAST DECADE, the convenience channel has been hard at work redefining consumers' perception of its food offerings. What was known as "gas station food" was often the butt of jokes in movies and on television and, in real life, many consumers could not imagine choosing to go to their local convenience store to pick up a pizza instead of their local pizzeria.

That has changed. Through organizations like Partnership for a Healthier America, which counts many c-store retailers among its membership, and a concentrated shift toward fresh, healthy and on-trend offerings, many convenience players have stepped up their game.

But it takes more than just selling fresh food to have a profitable foodservice program. As with all other areas of the store, technology is playing a bigger role in foodservice.

"To state it bluntly, technology today within foodservice is the difference between success and failure," said Kay Segal, founding partner of Phoenix-based consulting firm Business Accelerator Team (BATeam).

For operations, the appropriate use of technology can assist with everything from labor scheduling to production planning to recipe management.

"These tasks can be handled without the newer technology, but consistency of execution is the issue," Segal explained. "With technology involved, there is more likely consistency of process and there are trackable metrics to ensure exceptions are flagged quickly and corrective action can be obtained."

Technology can also help a retailer be competitive from a customer engagement and marketing standpoint.

"From being found — via things like Yelp or Google — to engaging with consumers from

platforms like Instagram, to the use of geofencing software which can alert retailers when to cook remotely placed orders, there are myriad uses for technology with consumers," she pointed out.

Operators in the convenience channel need only take cues from quick-service restaurants (QSRs) to see how far foodservice technology can go. "Our industry must benchmark to the best-in-class QSR chains and work to elevate our consumer experience to be on par," Segal said.

Times Are Changing

Foodservice-technology needs have developed rapidly over the past few years — a trend that will continue as retailers expand their menus, and online or in-store kiosk ordering become best practices for those chains expanding in the category, according to Bill Nolan, a partner at BATeam.

"Technology will continue to define how orders are made by the consumer, making it easier, more friendly and quicker, I'm sure," he said, noting that technology will also streamline how orders are received, prepared and delivered to consumers.

"Frankly, if retailers do not expand their foodservice technology, they will be left behind. Whether it be website advertising, online ordering, kiosk-to-kitchen ordering or contactless checkout, all of these innovations are not only expected, but are becoming the norm — not only for the 20- to 35-year-old demographic, but [it] is reaching into the more mature audience also," Nolan said. "Why? Because of cultural progress."

Retailers can reap several benefits from tapping into foodservice technology. Wynne Barrett, founder/partner of Jera Concepts LLC and vice president of business development for the company’s Supplyit fresh food management platform, pointed to such benefits as:

• Improving merchandising to facilitate sales growth; • Controlling waste to improve profitability; and • Directing labor more efficiently.

"Interest in foodservice management technology is growing among foodservice-mature groups,” Barrett said. “We have had a lot of conversations with retailers who are just not there yet. Many still use Excel which, while powerful,

The COVID19 Impact on Foodservice Technology

As with so many aspects of a convenience store's operation, the COVID-19 pandemic has highlighted the need for technology solutions when it comes to food safety.

"Consumers want to see safety measures in action. Technology can assist with safety processes and the capture of pertinent data," said Kay Segal, founding partner of consulting firm Business Accelerator Team (BATeam). "Retailers can share, in the appropriate manner, some roll-up metrics from their data capture. Transparency with consumers builds trust."

Technology that alerts store personnel — similar to timers on coffee brewers — as well as tech that provides badges or stars on an app can all be used to create ongoing trust with consumers.

BATeam partner Bill Nolan agrees that the health crisis has impacted, and will continue to impact, the reliance on technology in c-store food programs, but the extent is unclear.

"Today, I believe the consumer has been forced to become more used to ordering electronically. QSR [quick-service restaurant] drive-thrus or online ordering for restaurant pickup has become a way of life over the last year. This will continue to drive reliance on technology," he predicts.

However, as more Americans get vaccinated, shutdowns ease and travel restarts, it remains to be seen if consumers will migrate back to past norms over time.

"I believe the greater part of the population will, mainly because we are a very mobile and social society. So, yes, reliance on technology will continue, but I'm not so sure it will be primarily due to COVID-19," Nolan said. "Think of it this way: online or kiosk ordering has become normalized to the point where operators would prefer eliminating wasted labor hours taking orders. At several McDonald’s drive-thrus, you're talking to an electronic attendant. All this started in the last six months."

doesn't necessarily facilitate simple transparency into operation execution."

Borrowing insights from the restaurant industry, Supplyit help groups manage all things foodservice, specifically around production management and what to make when.

"We take retailers' sales data by time, or time stamp, to give them an appropriate forecast. We factor in things like shelf life. So, for example, employees will know that at 5 a.m., they need to make X amount of breakfast sandwiches," he explained.

The cloud-based solution also provides a simple interface to report waste. "Tablet interfaces have simplified the way data is collected,” he said. “Typically, waste is scanned out or recorded on a piece of paper. Tablet interfaces allow for in-the-moment and on-the-spot recording. It reduces input errors as well.”

Optimizing Operations & Labor

As the 2021 Convenience Store News Forecast Study found, 72 percent of retailers expect their average sales per store to increase this year, and 55 percent expect their average profits per store to increase as well. But sales and profits are dependent on optimizing operations.

According to Nolan, technology can have a greater impact on helping to control costs by creating better forecasting tools for the foodservice director — tools like cleaner inventory sheets of what's selling, where the waste is, and sales and product movement by daypart.

"Technology has become as important as marketing. Foodservice profitability does not come easy; there are a lot of moving parts: product costs, labor, quality consistency, waste, equipment/maintenance costs, and constant menu development," he explained. "The future of technology will be forced to help manage all of these functions as the best-in-class c-stores compete for their share of the food business."

Although foodservice is not new for most convenience stores, for many it is still a work in progress, acknowledged Shamus Hines, CEO of Applied Data Corp. (ADC), a Tampa, Fla.-based provider of fresh item management software.

"Senior executives are going to the directors and VPs and telling them the com-

“Foodservice technology will benefit the organizations that choose to adopt it — their quality will go up, their margins will improve, and their customers will be enabled to buy more of the food they want.”

— Shamus Hines, Applied Data Corp.

pany is going to do foodservice and make the economics work. The challenge is fresh food is finicky and outright complex — that is where technology plays the biggest role," Hines said.

Technology helps address the labor, waste and profitability challenges that go along with foodservice. Every single step matters so much when you are talking about doing foodservice at scale, he pointed out.

"Technology has been a great communication device for getting the expectations from home office down to the store. There is often a disconnect, and you are removing barriers by using technology to communicate to the store what they want to produce and when," Hines said. "All this technology is like an amplifier at the end of the day. If you had bad processes before, you would quickly find out where the disconnects in your processes are."

Foodservice generally encompasses two different types: made-to-order or made-to-inventory. Made-to-order includes more traditional, restaurant-style food. For example, ordering a customized pizza or sandwich either at the counter or through a kiosk. Made-to-inventory includes grab-and-go items that can be easily procured, like breakfast sandwiches, cut fruit, and salads.

Convenience store operators can look to quick-service restaurants to see how far foodservice technology can go.

"There are different technologies involved for each of these fresh foodservice offerings,” said Hines. “Each has its elements of replenishment in ordering, each has a recipe of sorts, and each certainly has a forecasting component related to replenishment and production.”

The way Jera Concepts’ Barrett sees it, the single biggest benefit of foodservice technology is that it provides retailers with transparency in store execution.

“It is knowing how people are executing the program at the store level. A retailer can then make the decision if the program is the right fit for the store and it is not an execution issue," he said.

Sophisticated c-store chains are looking at this right now, he shared.

"Retailers need actionable data to teach at the store level. It helps district managers talk with the store managers about what is happening at the store level," he added.

More Advancements Coming

Where is foodservice technology headed next? According to ADC's Hines, there are certainly advancements coming in artificial intelligence, which will enhance forecasting, decisions on food offerings, and labor scheduling.

"Prescriptive analytic advancements will come in terms of suggesting a more profitable category mix. With all this data, it should be possible to swap items out and adjust menus toward profitability," he explained. Another area ripe for advancement is labor reduction. “Retailers need to do more with less people, and technology is the way to accomplish this," Hines said.

He is bullish on how continued advancements in technology can help meet the needs of c-store retailers, along with helping operators meet the needs of their customers.

"This is what we are focused on. It is all coming to a head now and it's a good time for technology and retail," he said. "Foodservice technology will benefit the organizations that choose to adopt it — their quality will go up, their margins will improve, and their customers will be enabled to buy more of the food they want.”

From Segal’s view, the technology stacks and roadmap for success are expanding weekly.

"It is amazing how quickly what seemed to be future tech is standard fare — table stakes," the BATeam executive explained, advising that retailers should find key external resources to help them map and maintain their systems architecture, and the systems should be developed from the consumer back to operations and accounting.

"We know for certain that food tech will evolve to assist retailers with labor usage, consumer interface and purchases, and food operations management. Tech will be more integrated with every aspect of ordering, production and delivery to the consumer," Segal said. CSN