Facing Higher Wages, Wendy’s Exploring Automation Options To Cut Costs
What do rising minimum wages and the need for workers that are always prompt and courteous add up to?
If you’re an employer, especially in the quick-service restaurant industry you may say higher costs and problems. When there are problems, companies tend to look for solutions and we’ve already seen ordering kiosks pop up at Panera, mobile ordering at Starbucks and its coming this year to McDonald’s. Wendy’s is jumping on the ordering kiosk bandwagon, but it is also eyeing other “forays into automation.” Based on a recent McKinsey analysis of 800 occupations, “accommodation and food service” contain the highest percentage of tasks—73%—that could be completed using current technology. It seems automation, which includes robots of different kinds, could be popping up at Wendy’s before too long… not good news for the 5 million Americans who work in food and beverage serving industries.
By the end of the year, Wendy’s says it will have installed self-serve ordering kiosks in 1,000 of its restaurants.
COO Robert Wright told the LA Times that the machines, along with other forays into automation, will help reduce labor costs, which rose 5% at the company last year as a number of states—including Alaska, California, and Massachusetts—raised their minimum wages. Replacing human labor with machines, or threatening to do so, has become a common response to raising wages by fast food executives.
The first automated burger machine, for instance, debuted more than 50 years ago, but practical considerations, like the cost of the machine compared to labor and the machine’s limitations, stalled adoption. Today, as the price of labor rises, the cost of machines drop (three of Wendy’s kiosks, according to the LA Times, will cost just $15,000), and the quality of the technology improves, automation technology is becoming a legitimate option to fast food restaurants.
Source: Wendy’s will make automate ordering at 1,000 stores this year — Quartz
