Digitalization Will Help Combat Restaurant Supply Chain Shortages
As the pandemic fog lifts and the world gradually returns to “normal,” rather than finding relief, many QSR and fast casual restaurants are facing a whole new set of challenges triggered by supply chain issues that have plagued virtually every sector over the past several months.
What’s happening with the supply chain?
What’s going on with the supply chain is complicated — throughout the complex systems involved with moving goods into, out of, and across the country, processes are breaking down and supply shortages are causing some businesses to effectively grind to a halt. In some cases, manufacturers can’t access the supplies they need to produce everything from straws and napkins to frozen and fresh produce. Orders sit unfulfilled, or worse, stuck somewhere in the supply chain while products go out of date in the back of trucks and aboard transoceanic barges, for any number of reasons.
Here’s a typical example, as reported by Time. Sarah Sawicki, who co-owns chicken wing restaurants in Portland, Oregon, has had issues keeping her staple product in stock thanks to global supply chain constraints. Sawicki is at the mercy of suppliers, who have at times given her a single day’s notice about significant product shortages in her next delivery. Her restaurants share stock and staff members personally drive to warehouses to make pickups because there isn’t always a driver or truck available to get wings into the stores to keep up with demand.
At the recent Fast Casual Executive Summit in North Carolina, panelists pointed to supply issues as a top challenge for brands, coming in second only to labor issues, according to Vince Purves, president of Consolidated Concepts. According to an article on FastCasual.com, Purves said at the time of the conference, there were 70 to 80 tankers waiting off the coast of California to be unloaded — an issue creating significant backups for manufacturers and suppliers alike.
Supply chain shortages are creating customer friction in all facets of restaurant operations - ordering, delivery, product availability, and unpredictable costs.
Digitization can help restaurants mitigate supply chain issues
Despite the ongoing and emerging issues around supply chain breakdowns, restaurants that take an agile, future-forward approach are still thriving. Many are turning to technology to better manage the volatility created by supply chain disruptions. As one Fast Casual Executive Summit panelist said, “There are a lot of [digital] tools out there. Instead of waiting for Sysco or US Foods to tell you ‘hey, we’re out,’ you should know that ahead of time ... If you observe that on a weekly basis and see where your inventory is at and when you can expect it, this way you can work with the distributor and the manufacturer to make sure that this product is coming online.”
Digitized restaurants benefit from several operational improvements, including:
Order automation (timing controls and better lead times, for example)
Rapid and flexible pricing changes based on supply and demand
Centralized communication
Time management improvements
Better customer expectation setting for product availability, pick up, and delivery
Customer behavior data insights
QSRs and fast casual restaurants benefit from agile online ordering sites that can be adjusted on the fly. That way, even when there are surprise supply issues, changes can be made to ordering systems immediately, preventing frustration and confusion at pick up or delivery for online ordering customers.
Supply chain disruption also causes inflation and rising costs for the products restaurants rely on. This Robb Report features everyday items like fryer oil, take out boxes, and the price of meat have risen 100 - 300% in cost compared to 12 months ago. With digitization and owned online ordering systems, operators and owners can easily adjust pricing rapidly and in a targeted manner - by item, location, or both. This also helps to keep already thin margins agile and profitable.
When it comes to delivery, when a restaurant brand owns their delivery process digitally, they have a better ability to adjust customer expectations on both product availability and delivery / pick up lead times, which helps to remove customer friction that sometimes comes as a result of a third party service provider managing menu and delivery operations.
Onosys empowers brands to gain control over in-house online ordering by offering a fully branded, customizable interface that keeps the customer experience centered and allows agility when ingredients and supplies are delayed, missing, or not available. Onosys clients enjoy features you won’t find with third-party operators, including:
Unlimited configurations (modifiers, toppings, combos, à la carte options...)
Ability to make items out of stock by store location
Integrations including POS, loyalty, and payment systems
Dedicated call center staff for call-in ordering
Fully integrated, scalable catering system
Customizable storefront API integrations
Learn more about the Onosys online ordering solution and set up a demo today.
