Has the point of sale become analog in the digitized restaurant industry?

December 17, 2021 Windstream Enterprise 4 min

Editor’s Note: The point of sale has fundamentally changed for restaurants over the past few years. Increasingly tech-savvy customers are making more purchases away from the standard cash register, pushing businesses to digitize their transactional processes. Restaurants should expect to see a continuation of this trend into the next year, where more aspects of the traditional restaurant experience will become technologically advanced. With these shifts underway, you need to ensure that your underlying hardware and network capabilities will keep things running smoothly and that your restaurant stays competitive in a digital landscape.

Summary: Tech-savvy customers are making more purchases away from the standard cash register, pushing businesses to digitize their transactional processes. Here’s what restaurants can expect to see unfolding into the next year.

The economy of the past year and a half has taught restaurateurs (somewhat painfully) the art of the pivot. Many who weren’t equipped to deal with the abrupt and dramatic shifts in the industry last year had to scramble to adapt to new delivery and online ordering systems or face closure. 

Although for many it was baptism by fire, lessons emerged that have instigated a new and critical business approach. As operators navigate the aftermath, a period of uncertainty remains due to evolving cultural shifts in terms of how customers interact with retail and restaurants. But one thing is certain: The industry has reached a point of no return when it comes to the technology strategies restaurants must embrace. 

A key casualty of the pandemic for restaurants is the point of sale (POS) system as we have known it. No longer can restaurant owners rely on POS terminals alone to conduct transactional business. In fact, more than 70% of restaurant customer transactions are now conducted beyond the traditional face-to-face ordering experience. 

Rapid technological growth and developments in drive-thru, QR code payments, delivery, online ordering, and more have prompted a dramatic shift in consumer behavior. Consequently, it has become a business imperative for restaurants to more nimbly adapt to accommodate such market moves. 

The pandemic has also precipitated an explosive growth in futuristic restaurant technologies such as voice-activated ordering and drone delivery. Consumers (especially the tech-fluent younger cohorts) are showing their willingness to quickly adapt to these new behaviors. 

Because of this, the engine that powers these evolving capabilities has become critical. It is increasingly imperative that businesses have a cloud-based, transactional platform with an open API that can rapidly integrate new core and partner technologies as they are embraced by the market and consumers. 

In the same way that market and consumer pressures have urgently forced a shift away from cash to cashless systems, restaurants must embrace the flexibility and fluidity that transactional platforms provide to help them face evolving market conditions or they risk being left behind. 

The transactional platform  

But rather than creating a new technology, the transactional platform is a natural evolution of the point-of-sale concept as we have known it. We refer to our approach and core technologies as the heart of our clients’ business. The metaphor is apt because, in effect, we provide the engine through which each part of the restaurant business flows. The heart pumps blood throughout the body of the enterprise, enabling core functionalities and important partner capabilities like inventory management, online ordering and delivery, kiosk management, employee management and payroll, CRM and customer loyalty programs, and much more. 

For many merchants, this core transactional approach helped protect their business during the industry’s recent challenges. Rise Southern Biscuits & Righteous Chicken, a chain of 16 stores, had embraced a tech-forward business strategy pre-pandemic with self-serve kiosks they installed at multiple locations. While this waitstaff-free approach initially became popular with customers, when the pandemic shifted customer preferences towards contactless ordering, these prominent self-service kiosks made it much easier to maintain a safe social distance at Rise locations. 

Rise went a step further by introducing a fully integrated kitchen display system which enabled automatic syncing of orders between the Revel platform and the KDS, significantly increasing efficiency in the kitchen. Rise also implemented an online ordering solution and added a customer loyalty and digital gift card program which connected easily with its POS providing a rich and seamless business management experience. Just four weeks after the effects of COVID-19 became clear, sales at Rise locations had recovered to pre-pandemic numbers and then continued to increase to over 25% overall with profit in some stores reaching over 300%, thanks in part to their adoption of these contact-free and off-premises solutions. 

This core transactional platform should not only be ready to connect with a broad network of established partner offerings but for enterprising merchants and restaurants who want to connect their own bespoke software. An open API can offer critical flexibility when needed. 

Restaurateurs want to know how they can future-proof their business against the unpredictable nature of the hospitality market and, while of course no one can predict the future, it’s important to keep an eye on consumer trends and market forces. 

The term “point of sale” will probably become mostly defunct in the next 5 to 10 years. In its place, merchants will more commonly rely on a core transactional platform to successfully conduct their business—an engine that will drive the market forward by providing business management capabilities and seamlessly connecting exciting and innovative partner technologies. 

This article was written by Chris Lybeer from Fast Casual. News Features and was legally licensed through the Industry Dive publisher network. Please direct all licensing questions to legal@industrydive.com.

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Key Takeaway
Savvy restaurant operators will adopt a core transactional platform that includes inventory management, online ordering, delivery, employee management, CRM, customer loyalty programs and more.

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