The demand for restaurant software and restaurant management systems continues to grow.
Today, restaurant software influences nearly all core functions of a successful restaurant business – acquiring customers, booking tables, processing orders, kitchen displays, billing, payments, inventory, marketing and retaining customers. Online delivery marketplaces and restaurant aggregators have caused restaurant owners to re-think their business models and explore different revenue streams. And Restaurant-Technology is growing steadily as a separate category than the overarching and more noticeable “Food tech”.
What systems do restaurants use?
To better understand the entire software stack used by restaurants, let’s divide them into two categories – guest facing and back-of-house. Guest-facing restaurant software is any software (think app, website, online ordering, loyalty) that a restaurant guest comes directly in contact with. Back-of-house software refers to tools and software that restaurants use to streamline their operations and make their processes more efficient.
Guest-facing restaurant software
Search, discovery, review and delivery marketplaces
While not technically “software” but more food tech, Third-party aggregators, review sites and restaurant guide apps, dominate consumer behavior for discovering new restaurants. Social networks are increasingly instrumental in driving awareness and first impressions while Search captures high intent orders.
Examples of such technologies: Deliveroo, Yelp, Uber Eats, Zomato, Zagat, Foodpanda, Swiggy, Tripadvisor, The Infatuation, Renzell, Sociavore, Urbanspoon, Talabat, Amazon Restaurants, Caviar, Delivery.com, Doordash, EatStreet, GrubHub, MealPal, Postmates, Seamless, Slice, Tapingo and increasingly Facebook and Instagram.
White label restaurant websites, mobile apps, and online ordering systems
These are customizable websites, mobile apps and online ordering software (i.e the online front end) built for restaurants. White label software companies build customizable templates, backends and host your website and apps for you. Most of these companies would provide you with industry standard features and you get the benefits of scale (instead of trying to build everything yourself). White label software companies would also roll out periodic software updates so that your technology remains updated. This is the alternative to being entirely dependant on third parties for your online revenue channels.
Restaurant reservations & waitlisting software
These software allow customers to make reservations online, get a sense of their place in the queue and get real-time updates before they arrive at the restaurant. Most of them allow staff to update waitlists while still working on the floor. Loyalty and offer integrations allow restaurants to run campaigns to retain customers from the first reservation.
Loyalty & rewards
With growing customer acquisition costs for restaurants, Loyalty programmes and rewards networks are beginning to play a crucial role in opening up revenue streams from existing customers. Most restaurant loyalty software allows you to decide how members earn points. Again, a connected restaurant POS system is key to be able to serve customers with a seamless loyalty experience. And loyalty analytics lets you measure adoption.
Real-time order tracking
For real-time delivery dispatching, managing, and tracking. Similar to the order tracking features you see on most restaurant aggregator and third-party online ordering apps. These companies provide restaurants the ability to serve their customers with the same kind of delivery experience they get from the large aggregator apps.
Examples of order tracking software: Getswift, Orderlord, Hypertrack, Roadcast, Locus.
Mobile payments and wallets are here to stay. Payment technologies are helping make bill splitting and online payments more convenient for guests. Some restaurants are investing in their own branded apps whilst there are third-party companies that allow customers to manage their bill payments from a single interface. Users can add their different credit or debit cards and manage all their payments in a few clicks. Mobile payment technologies score big on convenience but also help customers track their spends better.
Examples of restaurant payment software: Clover, Heartland, Level up, My Check, Opentable, Resy, Sevenrooms, Square, Tablesafe, Toast, Verifone, Rooam
Reviews & reputation management software
Reviews are a legitimate way of discovering the next cool restaurant. Review sites like Yelp and OpenTable bring reviews to the forefront of the restaurant discovery process helping restaurant goers see what other people recommend.
Examples: The Infatuation, OpenTable, Resy, Sevenrooms, Venga, Wisely, Yelp, Zomato, Swiggy.
Restaurant marketing, analytics & CRM software
Restaurant marketing in 2019 is going to be driven by better visibility across a growing number of channels and more refined attribution of marketing effects. Restaurants are also likely to invest more in digital marketing beyond aggregators and review sites, in an attempt to increase repeat visits. With the line between online and offline marketing getting fuzzy, restaurant analytics software will continue to become more omnichannel in their reporting and insight mining. Integrations, modeling, and data visualization are going to be driving forces in the race towards better insights. CRM success will be led by automated customer segmentation and the ability to send out timelier marketing campaigns.
Digital gift cards
Gift cards have been around for a while. But the idea of gifting restaurant meal vouchers are likely to gain popularity with companies like Amazon now retailing gift cards on their platform. Gift cards see customer spend at least 20% more than direct payments.
Kiosks & digital displays
Self-ordering is a great way of cutting down the order processing time and serve customers faster. Especially for QSRs, multi-outlet chains and fast-casual concepts. Here’s Fuzz on evolving the ordering experience at Shake Shack.
Feedback & surveys
Measuring customer satisfaction has gone digital. Capturing feedback online allows for better customer sentiment and satisfaction analytics. Gone are the days of sneaking a feedback form with the bill and interrupting the guest experience. Feedback for restaurants these days is going the chatbot route with forms that mimic a chat screen rather than something that looks feels like a pop quiz.
Corporate meals & catering
There are aggregators specialized in bulk ordering at the workplace. Companies like Platterz and Zungry make ordering for a large group easier and fast. These companies offer pre-set menus for occasions like executive meetings, training and special occasions like company milestones. Restaurants like Biryani By Kilo are also making corporate ordering hassle-free, in India.
Examples: Chewse, Ezcater, Foodee, Food to eat, Peach, Zero Cater
Restaurant operations & back-of-house software
Purchasing & inventory
Arriving at the cost of food has always been a challenge for restaurants. Tracking waste is another common pain area. Inventory management tools are now focussed on taking inventory quickly, build orders from within the system, invoicing and accounting. Some tools also let you track changing prices of food and bar items. All of this leads to an accurate picture of your food and bar costs. POS and inventory management integrations are likely to see a lot of action in the coming year. Since an accurate picture of your costs can help you design menus that earn more.
Restaurant billing software & POS
The central unit of any restaurant software, it is always the first piece of technology that comes to mind when we think restaurant software. POS systems help record sales transactions and integrations allow that information to be used for everything from building customer segments, running loyalty campaigns to tracking your restaurant’s performance.
Human resources & staff scheduling
Restaurant HR software now does everything from training, employee scheduling, tracking shifts and productivity. Restaurant staff scheduling is one of those persistent challenges that software is now looking to solve, for good. Scheduling software is doing away with paper and multiple xl sheets and making it simple to schedule shifts according to historical sales data to prevent over and understaffing. Scheduling software checks employee availability, shift timings and leave requests, taking the manual work out of the equation. Companies like Squaddle is using blockchain technology to connect staff to restaurants. 7 shifts lets you, schedule staff, approve leaves, manage log books and collect feedback all from one platform. Hotschedules helps you cut labor costs by making data backed scheduling decisions. Waitrainer is a training platform that simplifies staff training.
Examples: Craigslist, Crunchtime, Culinary agents, Good food jobs, Hotschedules, Snagajob, Ultipro, Cohesion, Kitchensync, Tips sender, 7 shifts, Dolce.
Kitchen robots are in. Moley has built the world’s first robotic kitchen while Dishcraft makes robots for the commercial kitchen. Domino’s Pizza has self-driving delivery. Chowbotics has a robot chef named Sally. Zume’s pizzaiolo is a robot. And Cafe X is a barista who is actually, you guessed it, a robot.
Examples: Chowbotics, Dishcraft robotics, Halton, Miso Robotics, Rational.
Food waste management software
A reported 1.3 billion tons of food are wasted every year. Wasted food is the third largest producer of carbon dioxide in the world, after the United States and China. This equals US$1 trillion dollars of wasted or lost food. There are technology companies that are attacking this problem. Take, for example, Too Good to Go, an app that lets users order unsold food at restaurants that would have been wasted. Or Spoiler alert, that provides real-time analytics on food about to be wasted so that restaurants can slash prices or donate.
Examples: Copia, Crunchtime, Food for all, Mint Scraps, Spoiler alert.
Restaurant accounting software
Accounting for restaurants is more convenient online and through software thanks to companies like AccountEdge, Sourcery and Restaurant 365. This software come with document management and banking features. And most restaurant accounting software has an audit feature that helps you record important financial information correctly and keep an audit trail. Given the sensitive nature of this data, security is key. Accounting software takes backups of your data, verify your company files and help restaurants automate their AP and AR.
Examples: Cohesion, Restaurant 365, Kitchen SYNC, UT&I, Compeat, Shogo
From sales, inventory, employee productivity, marketing to accounting, restaurant analytics are increasingly going to make use of connected software to deliver better and cost-saving insights. But this tsunami of data and the associated complexities are giving rise to companies like Omnivore, that help restaurants tackle and arrive at the best use of their data. Again, just like POS technology, business intelligence for restaurants is going to driven by connectivity. At LimeTray we are addressing the evolving data opportunity by polishing the connections between our systems. Ultimately helping restaurants grow their margins.
False reports, watering down drinks, short-ringing – there are so many ways in which you might be losing out in your restaurant. A surveillance system that connects to your POS is your best bet to check against such fraud. Your restaurant also needs Fire security and burglar protection. Companies like Solink, Cipher Cloud, Somansa and Digital Guardian have built software solutions specialized for this kind of security needs at restaurants.
Examples: Solink, Cipher Cloud, Somansa and Digital Guardian
Bluetooth temperature sensors
In a bid to ensure compliance with HACCP (to ensure food safety), restaurants are using Bluetooth temperature monitoring systems to measure food and equipment temperature. These sensors measure food and kitchen equipment temperature against pre-programmed thresholds to alert any discrepancies. Whilst using manual handheld thermometer and probes are an option, restaurants are now opting for these automated Bluetooth temperature sensors to fast track this process, avoid fake reports by employees and automatically record temperature readings in a HACCP log.
Why restaurant software?
Rent customers from third parties or have loyal ones?
Delivery is going to get bigger. And third-party aggregators will continue to take a large slice of that pie with rapid partnerships, integrations, new product launches and acquisitions. Being profitable after paying larger third-party fees, is going to be a continuing challenge for restaurants.
White label restaurant software solutions to the rescue
This profit problem for restaurants is leading to prominent growth in the white label SaaS space with software for restaurant websites, mobile apps, Online ordering, reservations, CRM and loyalty.
POS moves to the cloud and gets tableside
Whilst traditional on-premise systems continue to outnumber newer cloud-based POS technologies, the migration seems inevitable. After on-demand delivery, this sector is witnessing the most innovation from restaurant software companies. And driving the demand in this space is simply, more connectivity. POS companies are looking at exploring more opportunities to connect customer data, pack features and enable more automation.
A single view of the customer
As the restaurant technology ecosystem evolves in 2019, the need of the hour is going to be a holistic view of the customer, even before they show up. Connecting historical transaction data with your customers’ preferences and social signals is going to be key. So that customer personas get richer and it helps restaurant operators give better recommendations. And serve the kind of personalized experience that keeps customers coming back for more.
That brings us to the data question
Whilst restaurant management software are collecting large amounts of data, they continue to exist as disparate data tables. 2019 is going to demand a more connected data ecosystem that makes use of data in more seamless ways. Early days for restaurant data yet.
Integrations vs. built-in features?
Every restaurant software company preaches integration as the answer to all your connectivity needs. What they don’t tell you is that integrations are hard. Most software companies at different ends of the spectrum give you a one-time integration. So what happens when there’s a new use case or you have a new requirement from your restaurant software? Or open up another outlet? You are back to starting over, spending time connecting wires instead of connecting with your customers. And Integrations are expensive too. According to this report, the overall costs of integration are actually higher than the costs of software being integrated. 2019 is likely to see the need for full(er) stack restaurant management systems.
Tracking last mile brand conversions
In all likelihood, server recommendations today, assist more first-time brand purchases than tent cards or coasters do (which get an inordinate amount of industry spend). And the restaurant is assisting more of these that get recorded. Digital channels that assist and track these conversions are likely to play an important role in the evolving restaurant technology landscape.
The restaurant software landscape continues to evolve
As the restaurant software landscape continues to evolve, the driving themes are going to be connectivity – connected POS systems, connected data, and richer customer profiles. It will be interesting to see how restaurants move towards building up their own technology stacks and take on the market, dominated by third-party aggregators.