The hospitality industry has always been centered around delivering the best service possible. After all, owning a restaurant means creating memorable experiences that keep guests coming back, right?
However, today, running a successful restaurant requires more than just impeccable service and great food. With a myriad of challenges, from shrinking margins and rising ingredient costs to labor shortages and higher guest expectations, there is a lot of pressure to provide a top-notch dining experience while managing these hurdles.
The smart operators are finding ways to adapt and thrive in this new environment. One of the most promising solutions is the adoption of artificial intelligence (AI). While many still view AI as a tool that might replace human workers, the reality is far more nuanced.
Rather than replacing people, we think of AI as a supportive tool that helps by removing operational friction, so that restaurant staff work smarter, faster, and more efficiently.
As a company that’s put all its faith in the evolution of ResTech, we here at EMERGING are always interested in exploring how AI is continuing to shape the restaurant industry, and how it can empower restaurant operators to meet the challenges of the future.
The Rise of AI in the Restaurant Industry
AI has already integrated itself into the restaurant sector. In just a few years, it will most likely be a necessary initiative for restaurant owners and operators who want to survive. As of 2022, more than 75% of restaurant operators in the U.S. noted they had already implemented or were planning to integrate AI-driven tools into their businesses.
That percentage is steadily growing.
From predictive analytics to AI-powered kitchen equipment, these technologies are helping to minimize food waste, boost profits, and optimize the dining experience.
One of the most prominent examples of AI integration is in smart digital systems. Restaurants have adopted AI-powered point of sale (POS) systems that can predict sales trends and manage inventory in real-time.
AI-driven kiosks are also becoming commonplace, allowing customers to place their orders quickly, which reduces wait times. For instance, McDonald’s is beginning to use a new AI to reduce wait times and make a better overall experience for customers and staff.
With AI-enabled drive-thru technology, AI-powered management tools, and Wi-Fi-enabled kitchen equipment, representatives from McDonald’s believe this kind of tech could propel them from 175 million restaurants to around 250 million by 2027.
AI’s Impact on Consumer Experience
One of the most exciting advancements brought by AI is its ability to hyper-personalize the customer experience.
AI systems can analyze data on past dining behavior, preferences, and even mood to suggest dishes, wines, or special offers tailored to each customer. With machine learning algorithms from companies like Incentivio and ebbo, restaurants can optimize loyalty programs to make them more personalized and engaging.
Beyond personalization, AI is dramatically improving the speed and convenience of dining.
Automated ordering systems and AI-driven waitlist management platforms can cut down on wait times, so customers can spend less time waiting and more time enjoying their meals. For example, AI-powered systems can automatically seat customers based on predicted arrival times, so staff aren’t as overwhelmed during peak hours.
Of course, many customers also feel it’s just as important to balance machine integration with a human touch. While AI can certainly improve convenience and efficiency, there are concerns about data privacy and the loss of human connection that must still be addressed.
Operational Efficiency and Automation
One of the main benefits of AI is that it can optimize restaurant operations by automating a variety of tasks that were once manually intensive.
Kitchen automation is one area where AI is having a profound impact. Robotic chefs, such as those made by companies like Spyce, which was acquired by SweetGreen, are capable of preparing meals faster and with more precision. This is great news for franchises that bank on consistency across locations.
By automating routine tasks and taking historical data into account, AI is also helping improve staff efficiency.
For example, predictive scheduling systems use historical data and demand forecasting to create more accurate staffing plans, so restaurants are staffed appropriately during busy periods, while avoiding overstaffing during quieter times.
This technology can reduce unnecessary labor costs by up to 15%, so restaurants can remain more profitable.
Challenges and Ethical Considerations
While AI undoubtedly offers significant benefits, we’d be remiss not to acknowledge the challenges and ethical considerations it presents.
Data privacy is a primary concern, as AI systems collect and analyze vast amounts of consumer data. Europe has GDPR regulations, which help regulate privacy laws. Unfortunately, we don’t have any privacy regulations at the federal level here in the United States regarding these systems.
Restaurants open themselves up to liability when they use these systems, which is why it’s equally important to implement robust data protection policies and maintain transparency with customers about how their information is being used.
Algorithm bias is another challenge.
AI systems can inadvertently perpetuate bias, particularly with hiring practices or personalized marketing, which is why it’s important for restaurants to ensure their AI systems are programmed to avoid discrimination and make fair decisions.
And, of course, AI’s impact on employment remains a contentious issue.
While AI can reduce the need for certain manual roles, it is also creating new job opportunities, particularly in areas like AI maintenance, data analysis, and customer relations. The key will be to provide workers with the skills necessary to adapt to these new roles, so that the workforce can evolve alongside this technology.
Embracing the Future
By 2030, the global market for AI in the food and beverage industry is set to grow at a compound annual growth rate of 39.1%.
Not only will it redefine how restaurants operate, but also redefine how they connect with customers, reduce waste, and drive sustainability. The future of the industry will depend on how we choose to embrace these technologies when thoughtful and ethical.
As the industry continues to evolve, restaurants that adopt AI will have the competitive edge. By working with industry leaders like EMERGING, you can stay on the same playing field by finding ways that AI works for you.
Get in touch with us today if you’re interested in how you can discover new opportunities in ResTech and position yourself for success in a rapidly changing world.
