How AI Is Revolutionizing Restaurants, From Smart Menus to Dynamic Pricing

This vision empowers restaurants to navigate supply chain complexities with efficiency and clarity. AI-powered benchmarking for competitive pricing and operations Many restaurant operators lack the time to benchmark or compare their performance against their peers. AI-powered tools can provide next-level benchmarking insights, allowing operators to quickly compare their performance with eateries in their area and understand local market dynamics across menu items and operational metrics.

Recent in Menu Trends

With high-quality data and refined models, the possible ways to put AI to work are nearly endless, but it often pays to take a granular approach. History teaches us that the more refined the model target, the better the output for business-use reliability. As the technology advances, we’ll likely start to see a lot of small—but highly reliable—prescriptive solutions with very targeted scope. AI can make real-time upselling smarter, modifying suggestions based on inventory, time of day, and weather conditions. For instance, on a hot day, the system might suggest cold beverages or ice cream.

• As inflation drives costs higher, restaurants must find ways to offset expensive ingredients, labor, and rent while still meeting value-conscious customers’ expectations.
• With 83% of customers admitting to moving on to another restaurant upon getting voicemail more than once artificial intelligence phone technology allows to increase customer satisfaction without extra labor.
• As the technology advances, we’ll likely start to see a lot of small—but highly reliable—prescriptive solutions with very targeted scope.
• In drive-thrus, its digital menu boards can adjust to feature items that are more popular at a certain time of day, in certain types of weather, or based on how much traffic the restaurant is having.
• Increasing sales through tailored suggestions can be a game-changer for operators who often face thin profit margins.

And while AI may not be a panacea, to take things to the farthest extreme, AI might invent your next panna cotta based menu item. Hot dog sales dipped 9% in Q compared to Q2 2023, while prices only increased 1.9% year over year. This dip could suggest that consumer eating habits have changed or that prices have reached a point where guests are no longer comfortable paying. By proactively mitigating certain risks, restaurants will tap into AI’s true value. Dining out with my family recently at a bustling restaurant in Philadelphia, I noticed the server giving off a bit of a brusque, apathetic vibe.

The system used computer vision—cameras that take images and analyze them—to check the pizzas for quality before being sliced and delivered. Customers were able to receive images of their pizza ahead of delivery to ensure their order was correct. Fixed-area college campuses are ideal for food delivery, and Grubhub uses robots for food delivery on several college campuses across the country.

Is Your Restaurant’s Tech Holding You Back?

With 83% of customers admitting to moving on to another restaurant upon getting voicemail more than once artificial intelligence phone technology allows to increase customer satisfaction without extra labor. Additionally, AI could be used to track and analyze kitchen food waste patterns and customer behavior, revealing which ingredients are often discarded and why. This automation has increased operational efficiency by 30 percent, mitigating the impact of reduced staff. It also reduces costs between 5% to 9%, with self-order kiosks generating 30 percent increased sales in fast-food restaurants. The industry loses $25 billion in revenue from more than 11 tons of food waste generated yearly. AI-powered supply chain optimization—a technology delivering near instantaneous ROI.

• AI and machine learning can be used to help categorize hundreds of millions of menu items.
• Additionally, AI could be used to track and analyze kitchen food waste patterns and customer behavior, revealing which ingredients are often discarded and why.
• Customers were able to receive images of their pizza ahead of delivery to ensure their order was correct.
• Here, AI takes on more of a supporting role while human staff remain in control.

In the end, AI is simply a maturation of heuristic computing, whereby the machine can mine vast amounts of input to discover causal relationships that would otherwise go unnoticed. Steve Fredette is president, cofounder and a director of Toast, where he leads product and innovation initiatives. Prior to Toast, he worked on mobile app development before the iPhone came out, creating the first Flickr and Shoebuy.com apps. In his career spanning two decades, Steve also helped build up Endeca’s business in various roles before it sold to Oracle for $1.1 billion. In July 2023, the sector’s employment rate hovered at 0.5 percent below its pre-pandemic peak. Monthly job growth slowed significantly between April and July 2023, averaging fewer than 11,000—a stark contrast to the robust 53,000 average job gains of Q1.

🚙4 charts that show used car prices are not returning to normal any time soon

Autonomous delivery robots have the potential to ease some of the pressure of these labor shortages by taking short deliveries the final mile. AI allows restaurants to automate some customer interactions, such as drive-thru and phone ordering. This can improve order accuracy and help some restaurants alleviate staffing shortages that came up during the pandemic. With the advent of artificial intelligence, the McJob could become a relic of the past. Restaurants that struggled to get staff and supplies during the COVID-19 pandemic can now leverage new automation technologies to manage repetitive tasks that can make food prep faster. It is worth bearing in mind, however, that AI is only as good as the model it is based upon—and the model is only as good as the data used to train it.

In 2022, Uber Eats started testing delivery robots along sidewalks in Miami and added another trial in Fairfax, Virginia, in April 2023. Robotics are actual robots programmed to do either delivery or simple tasks in a kitchen, like making chips or emptying fry baskets. Kura introduced Kur-B the KuraBot around 2021, and employs plenty of other high-tech features including touch screen ordering and a signature conveyor belt that snakes around the dining room delivering plates of salmon nigiri and shrimp tempura. Even paying the bill at the end of the meal is automated — feed your empty plates into a slot on your table and a screen tallies your total. For example, AI can be employed to automate the flow of inventory, track waste, identify inefficient station scheduling, or adjust production pacing.

As inflation drives costs higher, restaurants must find ways to offset expensive ingredients, labor, and rent while still meeting value-conscious customers’ expectations. If this sounds like VIP treatment at your favorite neighborhood haunt, it’s not — it’s what the restaurant of the future could look like. Anyone who has visited a restaurant recently, though, might be inclined to think that this kind of dining experience is light years away. The key is choosing the right tool for your specific kitchen, not the flashiest one on the market. AI is not a magic solution for operational problems, poor menu design or weak brand positioning. However, when strategically implemented, it can improve speed, reliability and staff effectiveness.

In the AI-first hybrid model, AI manages the bulk of customer interactions, stepping aside only when complexity demands a human touch. The key is seamless transitions—when the AI hands off to a human, the full context of the interaction is preserved. Whether they make for a better or worse experience for the customer will likely depend on why the customer is at the restaurant.

To align the model to your business needs, start with your biggest pain point. The AI-first hybrid route could help handle the majority of routine interactions while escalating more complex cases to human staff. Or, if you’re looking to improve existing operations without major changes, a parallel hybrid approach might make the most sense.

Days In, Church’s CEO Roland Gonzalez Has a Story to Tell

In fact, one of the primary factors restaurant operators cite for moving toward more automation is the necessity of filling in labor gaps. Technological solutions that ease labor pressure have become essential tools. Beyond social media interactions, AI can personalize customer experiences through customized marketing strategies. AI can identify which products or services a customer prefers—such as a specific type of cuisine or popular dishes in a restaurant—and can help create targeted promotional campaigns that align to those individual preferences. Targeted promotional campaigns like these will resonate deeply with your audience, making each customer interaction more relevant. We’re experiencing a profound dive into understanding and anticipating customer needs like never before, and it’s entirely reshaping how fast we can connect with customers and create memorable experiences.