The Case For Kiosks

The Case For Kiosks
May 25, 2018 Angus Jackson
In Hospitality, Payment Processing read
Kiosks & Self-Ordering

 

Kiosks or self ordering tills started appearing in our supermarkets in the early 00’s and are now commonplace, and something that we’ve all become accustomed to…although not something that we’re all fans of! They’ve been the subject of criticism and angst among shoppers with the chorus of ‘unknown item in bagging area’ ringing in our ears. That being said, there are reasons why more types of businesses are implementing them, especially with the rising cost of labour.

 

Big hospitality businesses have created fantastic business cases for the implementation of kiosks with the likes of McDonalds reporting an increase of 5-6% in year one sales for stores that have upgraded to the new digital stores. They’ve even reported that people spend up to 30% more on kiosk transactions as there isn’t a cashier judging their purchase…what’s an extra 20 McNuggets between friends eh?

 

Until recently, self service kiosks have been accessible only by these large businesses with the price of a supermarket self-checkout around $31k (£22k). However, with the rise in tablet and cloud technologies we’re starting to see more accessible software driven kiosks on a wider scale in hospitality. Given that many quick service outlets are driven by small windows of opportunity each day, any way of increasing efficiency should be well received.

 

So what exactly is a self-order kiosk?

 

Quick service kiosk

A quick service kiosk is a freestanding customer facing screen that allows customers to order and pay for a without any interaction for staff. These days most of these kiosks only accept card payments and are entirely cashless. Typically, these kiosks will send orders through to a kitchen or prep area to be prepared by kitchen staff. Once they’re prepared, the orders are moved to a collection point where the customer can collect their products and leave

 

Table service kiosk

A slightly newer concept, but one starting to be seen more and more are table-service kiosks. These are kiosks or self ordering screens in table-service restaurants. Typically they consist of a screen or tablet on a customers table, with the ability for the customer to add items to an order & send to the kitchen at any point before they’ve requested the bill. With these kiosks, there’s usually a button to call for the attention of staff, or to request to make a payment. Payment is usually at the end of an order once the customer has put all of their desired products through the system.

 

ShakeSmart, the US based protein shake chain introduced tablet based Kiosks in 2017 to help speed up service during their busy peak times. With 10,000 product combinations and numerous upsells, the checkout was a bottleneck for the company. The kiosks worked so well, that they’ve now rolled out to each of their 6 sites. The introduction of kiosks increased capacity at peak times by a staggering 58%, & freed up cashier staff to work in other areas of the business. This in turn resulted to a 20% increase in sales and considerable labour savings.

Tossed started to roll out a kiosk solution in 2016 in response to limited capacity and surging demand during the peak lunch window. Rather than implementing just a few kiosks per store, Tossed opted to get rid of manned tills entirely, opting to run stores 100% with self-order kiosks. One major benefit of this switch to kiosk run stores is that 90% of staff are now able to help directly with order preparation rather than manning tills, helping alleviate a huge bottleneck at peak times. This reliance on preparation is a consequence of Tossed’s highly customisable product where customers can build their product to their own specification. With the success of the first few stores, Tossed has now rolled their 100% kiosk & cashless concept to all but two stores. This is perhaps one reason why they’ve triumphed over competitors in what’s a highly competitive space.

 

Rex & Mariano, a seafood concept by the company behind Goodmans Steak and Burger & Lobster wanted to try new technology when they opened in 2014. Rather than opening with a traditional table service model, they opted to use iPad minis for customers to order themselves from the tapas-style menu. When customers walked in, they were greeted by a host/hostess and walked to their table, at which point they were handed an iPad mini. This iPad mini had the full menu with descriptions & allergen info as well as buttons to call for help or to request the bill. This custom build app was fully integrated with their EPOS system to facilitate easy order management & seamless reporting. The app proved very successful with positive feedback from customers as well as clear labour cost savings. However, the concept was short lived and was replaced in 2015.

We’ve also seen other similarly aggressive kiosk roll outs recently with brands like GrabThai who, after trialling a few kiosk in one store, chose to adopt a 100% kiosk strategy moving forward with new openings.

 

It’s clear that there are some commercial benefits to self-order kiosks but what exactly are they?

 

Increased speed of service- A result of a few consequences of kiosk ordering is that it should increase the overall speed of service by re-allocating resources to where they’re needed the most. Not only that, but customers also feel like things are moving faster (even if they’re not) when they’re actively involved in the process.

 

Redeployment of staff- Involving customers in the ordering process allows staff to be redeployed to other areas of the operation to help increase overall efficiency. Very often in a hospitality environment, preparation is a bottleneck; involving more staff in this aspect of operations should allow food to be prepared & expedited much faster.

 

Increased upselling- Successful upselling has traditionally relied on strong training and receptive cashiers & it’s something that we see smaller business struggling with. Using Kiosks enables you to rely on technology, rather than staff to upsell. Kiosks can be programmed to your exacting specifications and can suggest certain products alongside others.

 

Increase in average spend- With the improvements in upselling, there is a natural increase in average spend. As we saw earlier, McDonalds have seen that people spend 30% more on average when using their kiosks. Research by Tillster shows that average spend is 15-30% higher on kiosks depending on whether the kiosk is designed for speed of service or upselling. After Tossed implemented their kiosks, they found they were able to move to a fully customised product as customers were willing to pay more on average for something that they designed themselves, essentially ‘premiumising’ their product.

 

Improved convenience- Consumers these days are looking for quick and easy, especially in the competitive lunch market. People want to avoid queing wherever possible & a good kiosk strategy can make that possible. Research has shown that people will actively leave queues that are too long & will take their business elsewhere. On the flipside, if customers have left your competition due to the queues, your kiosks might be an attractive option.

 

Increased capacity- If you’re able to redeploy staff to areas of an operation that have previously been a bottleneck, then you should be able to increase overall capacity. The more capacity you have, the more orders you should be able to process and therefore the more the revenue. It also means that you’re minimising the chances of losing any new customers.

 

While the benefits of self-order kiosks are clear, it’s important to remember that they need to be fully & seamlessly integrated into operations to realise those benefits. It’s also important to note that they aren’t going to work for every business or concept. However, for many businesses where capacity or labour costs are a problem, kiosks could be a welcomed solution. With the rise in cashless technologies and changing consumer behaviour, we’d even go as far to say that some businesses can’t afford not to implement them.

 

If you need advice or guidance on implementing kiosks into your business, get in touch with one of our team today.