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Operations

5 moves restaurant operators made to best the competition

Amid signs that some restaurants are winning back customers, a few well-known players are intensifying their pursuit of an operational edge. Here's a sampling of those efforts.

A number of restaurant chains are reporting marked improvement in sales and traffic for the first quarter, but that hasn’t slowed their pursuit of operational benefits. Here’s a roundup of what some brands are doing to save labor, bolster throughput or deliver a better guest experience.

1. Shake Shack rethinks cashless …

The next batch of restaurants from the fast-growing burger chain will feature the high-end touch of self-service kiosks, but with a twist. Also on the premises will be cashiers to handle patrons who want to pay in cash, a result of what the concept learned from a lone cashless store near New York University in New York City. The future shock registered by some would-be customers has convinced the Shack to try hybrids instead of forging ahead with a no-cash policy, though that approach will be maintained at the one store.

2. … And begins a multimillion-dollar ops upgrade

Shake Shack informed investors that it intends to spend $3 million to $6 million, most of it this year, on what it’s calling Project Concrete, an upgrade of “core financial and operational systems,” CEO Randy Garutti told financial analysts. The company has already spent $181,000 on consultants and advisers for the upgrade, but has not revealed the particulars of the planned changes. 

3. The Habit to tweak drive-thrus, expand breakfast test

A new unit of The Habit will feature a new kitchen layout to support the store’s drive-thru, a move intended to be more efficient for the staff as well as a time-saver for customers, according to CEO Russ Bendel. He didn’t divulge details, but noted that the effort dovetails with other adjustments at the drive-thru, a channel becoming increasingly important for the fast casual.

For instance, the brand is exploring new ways of reminding customers at the drive-thru that The Habit’s food is made to order from ingredients they wouldn’t normally associate with fast food.

The focus on the drive-thru dovetails with the chain’s test of breakfast, which is currently offered at only two stores, both of those in university locations. The test will spread to six units in June, Bendel said, and apparently all are drive-thru locations. “Doing so in the drive-thrus gives us a better launching pad,” he told financial analysts. “But if breakfast is to be successful—and we're excited about getting it to test—we see it as more than just in drive-thru locations.”

4. Del Taco’s next chapter

The Del Taco Tex-Mex quick-service chain plans to implement a number of operational and marketing changes next month under a program the brand has christened Elevated Combined Solutions.

CEO John Cappasola didn’t list all of the initiative’s components, but described it as a comprehensive undertaking to set Del Taco apart from competitors, the main one being Taco Bell. Included will be the rollout of new, faster prep equipment in the third quarter, a refresh of menu boards, the rollout of an app and an expansion of delivery to more of the system.

The changes will be touted in new marketing that emphasizes fresh prep and ingredients. They coincide with an expansion of Del Taco's Buck & Change menu, which is intended to draw bargain-hunters away from options priced at just a dollar or less.

The kitchen changes will have the added benefit of cutting labor hours, executives told investors. 

5. Texas Roadhouse passes on kitchen tech

Ever the contrarian, Texas Roadhouse let investors know that its old-fashioned, paper-based system for getting orders from server to kitchen is in no need of a digital update to a kitchen display system, thank you very much. The cultural benefits exceed whatever the brand might lose in serving speed, explained President Scott Colosi.

“Our folks at Roadhouse almost overwhelmingly, when we ask them about that, would rather stay with our existing ticket system,” he told analysts. “So we’re not pushing it.”

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