The food industry remains one of the biggest business sectors in the world, with a current market size of $2.3 billion projected to grow to a whopping $5.1 billion this 2029. Despite its enormity, various operational problems still persist even in leading restaurants–inventory wastage, demand forecasting, supplier management, employee management, and more.
For this reason, businesses are geared towards resolving these issues through Artificial Intelligence (AI) and Machine Learning (ML) technologies to ensure excellent dining experiences for everyone.
How can AI be used in a restaurant?
When people hear about AI in restaurants, they immediately assume robots are creating and serving their meals. While this is true for some restaurants, the biggest portion of AI technology is found in the backend operations. A recent Forrester survey reported that 69% of companies are enjoying reduced operations costs through AI, with the fast-food industry being the biggest user.
Here are some ways the food and restaurant industry utilizes artificial intelligence and machine learning technology:
An average-sized restaurant with 25 tables needs around 5-6 front staff to ensure efficiency. This can dramatically be reduced to half through conversational AI as it can cover major tasks, including booking tables, adding guests to waitlists, ordering meals, and answering basic questions.
Recent surveys suggest that 53% of people would like to search for restaurants and menus, while 49% use voice search to find information about a specific restaurant. These figures show that most consumers today are comfortable with using voice commands, making voice ordering an essential tech solution for restaurants.
Further researches also suggest that AI voice solutions on drive-thrus and self-service kiosks reduce order errors by 90%. This significantly increases operations efficiency, resulting in higher customer retention and conversion rates.
An average restaurant wastes 10% of food before even making it to a customer's plate, making inventory and supply management the most prevalent issue in the food industry.
Fortunately, by integrating AI inventory solutions into restaurants' point-of-sale (POS) systems, restaurant operators can monitor and manage their supply in the most efficient way possible. This includes tracking inventory purchase data, limiting waste, and controlling food costs.
Accurate data-based insights
One of the best use cases of data science in the food industry is generating accurate data-based insights that allow restaurants to know what, when, and how to sell their items based on consumer history and market trends. This technology makes a restaurant competitive while reducing unnecessary inventory and staffing costs.
Online review management
A recent study conducted by Tripadvisor shows that 94% of people read responses to reviews when finding a new restaurant. The respondents specifically noted that well-crafted responses encourage them to try a restaurant despite bad reviews, making review reply generators one of the most useful AI-powered technologies for restaurants.
Aside from this, reports also suggest that 58% of consumers would pay more to support a company with good reviews. Therefore, brands across all industries should care about product reviews as much as consumers.
Click here to learn more about how online reputation can boost your business.
How is AI impacting the restaurant industry?
AI technology ensures a more efficient management process. Furthermore, it allows restaurant managers to unload staff tasks so they can focus on making your food. Here are some of the benefits enjoyed by restaurants using AI.
AI technologies allow restaurant owners to automate routine and simple tasks, allowing them to reduce labor costs. Furthermore, demand forecasting technology present in ML solutions allows restaurants to manage their stocks properly, avoiding food wastage, logistic costs, and other unnecessary costs.
Human error is almost a regular thing in every restaurant. A server attending a busy dining room can mishear orders, thus making the chef cook the wrong dish. While it may sound mundane, the continuous recurrence of this error can cost hundreds of thousands of dollars go down the waste bin.
Empowering your restaurant employees through AI technology and excellent POS lessens the possibility of human errors. This will not just help you save time and resources but will also help your staff focus their energy on taking in more orders for increased revenue.
Upselling through relevant consumer data is now the most lucrative marketing approach in the restaurant industry. Providing customizable ordering options for your customers generates higher conversion rates.
In a recent survey by Technomic, 72% of consumers expect customization in every order. Customization creates dynamic menus based on customer order history and purchasing behavior. This way, customers get the exact order they want while enabling restaurants to upsell some items.
Improve guest service
While no AI technology can mimic human touch in a dining experience, unloading simple and routine tasks from your staff allows them to focus on more vital tasks. They can focus on every guest's needs, ensure the best quality on every order, and provide exceptional customer service.
Furthermore, removing mundane tasks from your team reduces employee burnout, which has increased by 52% in the food service industry. High employee retention is as necessary as customer retention, as each hiring process costs time and money, which could've been dedicated to other activities to generate revenue.
Find new customers
According to recent surveys, 74% of people prefer to order their food online, making your online presence your most crucial marketing tool. Fortunately, there are AI-powered review management tools that could help you create strong online credibility through customer reviews.
Furthermore, these technologies also boost your visibility on search engines through SEO and content creation.
To learn more about review management tools, click here.
What is the risk of AI in the food industry?
While AI provides powerful technologies, they can only be as effective as their users. When misused, AI in restaurants can lead to customer dissatisfaction, privacy issues, environmental harm, and health problems. Because of these risks, business owners must ensure that all AI technologies utilized in their companies will be used with utmost care and mastery.
12 AI tools every restaurant manager should know
To help you understand how AI is used within the restaurant industry today, here are the top AI tools every restaurant manager should know.
- MARA AI- Review reply generator for reputation management.
- VOICEplug AI - Interactive and conversational ordering solution for restaurants.
- Winnow Vision - Food waste management technology for restaurants and hotels.
- Greet - AI-powered virtual receptionist utilizing natural language use.
- Flippy 2 and FlippyLite - AI and ML-powered kitchen robots for frying.
- CookRight - AI-powered camera system for brewing coffee.
- Cecilia AI - World's first interactive AI bartender.
- Wobot AI - Video Intelligence Solution (VMS) to integrate operational insights into security cameras.
- Ingest AI - Real-time data integration solution for restaurants.
- Zira AI - Workforce management platform creating AI-generated employee schedules.
- UEAT - Dynamic menu generation based on customer data.
- Tidio - Chatbot and live chat solutions for restaurants.
MARA AI review reply assistant allows restaurant managers to respond to every customer review with personalized responses within seconds. Restaurants can now veer away from using a common business reply template, as MARA AI is specifically set to meet industry-specific metrics. Instead of saying a generic "thank you" message, you can easily generate replies that would reinforce a reviewer's note on your food's quality and exceptional customer service.
By achieving a 100% response rate and 3x faster response time, a restaurant can easily build a strong online reputation and create impressive customer engagement. This will not just help restaurant operators get loyal customers and attract new ones.
Click here to learn more about the importance of review replies.
VOICEplug AI enables restaurants to offer an interactive and conversational ordering experience. The solution is integrated with your restaurant's phone system, call center, drive-thru, and ordering system, allowing your POS to accept natural voice conversations and commands.
They first identify the website, apps, and systems that need to be voice-enabled, run their AI algorithms to seamlessly integrate it with their apps, content, and transaction flows, and deploy dialog flows. VOICEplug AI reported a 90% reduction in customer abandonment rate and lost orders and a 75% reduction in per-order costs among its users.
Winnow Vision is a food waste management technology that helps restaurants save time and money. Enabled with AI to maximize operational efficiency and data accuracy, Winnow Vision is helping hundreds of kitchens across the globe cut their production costs by up to 8% a year.
As of this writing, IKEA UK is one of Winnow Vision's biggest partners. The company reported €1.4 million in cost savings, 800,000 meals saved, and food waste cut across all stores by 37%.
Bensen AI's Greet provides an AI-powered virtual receptionist for businesses. Greet understands human voice and natural language use, matching it with automated workflows to transmit orders accurately.
Restaurants using Greet see a 50% reduction in phone interruptions and a 30% boost in online ordering. According to Anthony, a Chick-fil-A Franchise Owner, their restaurant received more than 100 calls per day which their staff needed to accommodate simultaneously. With Greet, they only have to attend to less than half of the daily calls as most orders are now directed by Greet to their POS.
Flippy 2 and FlippyLite
Flippy 2 and Flippy Lite are both reiterations of Miso Robotics' flagship AI product. Both robots help kitchen staff fry nearly anything, with Flippy 2 focusing on large-scale frying while Flippy Lite is made for single-serve orders.
The technologies feature AutoBins, which uses AI vision to automatically recognize food, transfer them to its cooking slot, and fry the food to perfection with less human interaction possible. This creates 2x faster food preparation time and 30% more fried food production to meet customer expectations.
Another Miso Robotics technology, CookRight Coffee, is an AI-powered system that monitors key metrics in creating coffee–volume, temperature, and time data. The system uses AI-powered cameras to monitor the brewing process and uses ML to identify items used automatically.
Panera Bread uses the CookRight technology for its Unlimited Sip Club Membership, allowing customers to drink unlimited coffee and tea each visit. According to George Handson, SVP and Chief Digital Officer of Panera, CookRight Coffee is a game changer regarding convenience and operational efficiency.
Cecilia AI is the world's first interactive bartender that can be customized for every business and event. Powered by conversational AI and voice recognition abilities, Cecilia makes cocktails crafted by acclaimed mixologists, chats with customers, and even promotes your brand to your visitor.
Cecilia AI is currently promoted for use in hotels, airports, VIP lounges, casinos, cruise ships, and offices, as high-volume nightclubs and bars might interfere with its voice recognition abilities. Despite this, AI is constantly updated with new cocktails and mixes to serve customers.
Wobot AI uses a video intelligence solution (VMS) to derive operational insights through your existing security cameras. To put simply, Wobot adds "brains" to businesses' camera systems, enabling them to track restaurant operations processes, automate service flows, monitor employee productivity, manage tickets or incidents, and more.
According to Wobot AI's recent survey, video intelligence allows businesses to ensure crucial food management tasks such as inventory management, staff hygiene, and food preparation. This ensures optimal food quality and service efficiency by up to 72%.
Ingest AI creates smart restaurants, allowing brands to fully integrate data on various areas of businesses. This includes revenue management, time and attendance monitoring, automated scheduling, COGS and purchasing, and reservation processes.
In an interview with WIRED, Kenneth Kuo, CEO of Ingest AI, claims that their algorithm can predict what is happening within any restaurant with 95% certainty. This allows restaurants using Ingest AI to better determine their staffing and materials needs and cut costs.
Zira AI is a workforce management platform that helps restaurants automate employee scheduling, including time and attendance management and payroll tracking. Zira creates dynamic schedules based on real-time employee preference, availability, and operation data, enabling restaurants to have the most optimal employee schedule with higher retention and work satisfaction.
Zira AI reports 30+ hours saved a week in scheduling, a 41% increase in employee retention, and an 18% labor cost savings from their partners across the globe. Furthermore, one of its prominent partners Chicken as Cluck reported 100% employee show rates and 95% employee on-time rates upon utilizing Zira AI scheduling solution.
UEAT's RAI is a smart recommendation module based on artificial intelligence that creates personalized customer experiences. This allows restaurants to achieve higher conversion rates by creating relevant dynamic menus and upselling products based on customer data.
Cooper Branch, a 100% plant-based fast-casual restaurant, reported a 26% growth in year-over-year sales across all locations and a 10% increase in ticket size through UEAT's dynamic menus. Other partners that have experienced a significant boost in sales through UEAT are Normandin, Sushibox, Mandy's, and Five Guys.
Tidio offers chatbot and live chat solutions for businesses. Their AI software suggests menu items, makes reservations, takes orders, and provides exceptional customer service to increase a restaurant's conversion rate.
Aside from all these automation processes, Tidio also emphasizes the importance of customer feedback collection, as 87% of customers look at online reviews before buying from a brand. They have a feedback chatbot that automatically reminds customers to leave reviews on third-party restaurant review websites such as Yelp, Tripadvisor, and Google My Business.
To learn more about the importance of online reviews in restaurants, click here.
Restaurants powered by AI are dominating the market.
From inventory management, food preparation, customer service, and more, AI truly impacts the food and restaurant industry. While other professionals are still adamant about using it, AI companies have said that their solutions are geared towards helping people become better and more efficient, not replacing them.
AI can't beat you–a person using AI will. After all, every restaurant manager's goal is to serve delicious food with less food waste, operational errors, and employee burnout–all of which could be granted by AI.
This article is part of our hero content “The Future of Hospitality Industry: Integrating AI into Hotels and Restaurants".
Frequently Asked Questions:
AI technologies can help restaurants in creating efficient workflows for inventory management, food preparation, delivery services, customer service, and food waste management. This helps companies provide customer satisfaction that may lead to revenue growth.
Data science used by AI technologies helps improve food demand forecasting in restaurants, which leads to more controlled food production and reduced food waste.
Machine Learning (ML) algorithms predict demand for food products, which helps restaurants produce only the right amounts of food. Aside from this, it also creates a more efficient food serving and delivery method, which further helps in preventing food wastage.
Yes. Pazziria at Beaubourg Paris opened its doors on July 5th, 2021. Pazzi Robotics, a leader in food technology, powers this fully automated restaurant.
AI technologies help restaurants manage orders accurately. The process covers efficient order assignment among restaurant locations, estimating preparation and delivery time, and ensuring precise order dispatch.