These days, it doesn’t take long for conversations about delivery unit economics to turn to robots.
The reasons are obvious. Autonomous vehicles that travel on streets or sidewalks promise to solve a lot of the problems with food delivery: cost, speed, sustainability. As robot delivery company Serve puts it, “Why move a 2-pound burrito in a 2-ton car?”
And those conversations, some industry leaders insist, are becoming less theoretical and more real as consumers’ appetite for delivery continues.
Atul Sood, chief business officer of ghost kitchen company Kitchen United, is particularly bullish on the future of food delivery. He believes the channel could eventually account for a third of all restaurant demand, with robots playing a key role in that.
“As those types of automated programs become more prevalent, the cost of delivery goes down,” he said during an interview at last week’s FSTEC conference.
His timeline for when we might see that happening at scale? Just two or three years in urban markets, and five to seven in the suburbs.
“There’s so much consumer demand,” he said, adding that the technology is there, as well as a blueprint for rapid expansion.
“These companies have developed a game plan for getting cities to approve their use cases,” he said.
As for restaurants, they’re ready and willing. When asked what technology would have the biggest impact on his business, Smokey Bones CEO James O’Reilly said anything that can get food to the customer’s doorstep hotter, fresher and faster “would be absolutely huge,” including robots, automated vehicles or even drones.
Fellow panelist John Peyton, CEO of Dine Brands, has already witnessed the impact of robot delivery as a former executive at Starwood Hotels. The company began testing them eight years ago to handle room service at some of its Aloft properties.
“They could program it to go from the basement to the elevator to the door,” Peyton said. “It’s not so far off to think that could happen” at restaurants.
Executives from multiple restaurant brands also expressed interest in drone delivery as a real possibility in the coming years.
“Whoever does that first is going to win,” Peyton said.
Sood, who was with McDonald’s when the burger giant tested airborne delivery, said he doesn’t think it’s as imminent as robot delivery, but that its impact could be just as significant.
“That’s going to change our landscape in a completely different way,” he said.
El Pollo Loco, which is conducting limited drone delivery tests in Southern California, believes it could reduce the cost of delivery by 30%. Its drones are also delivering food faster, in an average of 12 minutes over distances of up to 2 miles, as opposed to 37 minutes for traditional delivery.
Like El Pollo Loco’s test, most robots and drones remain firmly in pilot mode at restaurants. But the number of pilots is piling up. To name a few:
- Domino’s is testing autonomous vehicles from Nuro, a company that also received an investment from Chipotle Mexican Grill.
- Ghost kitchen operator Reef is testing bots from Cartken in Miami.
- The state of Michigan recently unveiled an unusual partnership with Kiwibot to provide robotic deliveries in an economically challenged area of Detroit.
- Kiwibot is also in use on several college campuses, which have become a popular proving ground for the technology.
Also on the docket for Kiwibot is outdoor to indoor delivery in places like downtown high-rises.
“Imagine if you could order food, or anything that fits in a robot, to your desk,” Kiwibot COO Diego Varela said in an interview earlier this year. “That might be possible in the next 12 months.”