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Foodservice Industry Hits Strategic Reset with IoT

The COVID phenomenon has upended businesses in several verticals, and among the most impacted is the foodservice industry, characterized by high-touch, labor-intensive and, mostly indoor operations. However, this industry has taken the initiative to adopt modern technology to fight its way out of the crisis.

Case in point - a major US foodservice company with nearly $10B in revenue and over 1000 stores nationwide recently made the decision to partner with Ayla Networks as part of its digital transformation initiative. Why? The company’s leadership team saw that new technology, specifically IoT, was a way to improve store operations, accelerate menu innovation, and ultimately deliver a superior guest experience. The results are real and quantifiable – an estimated 25% in OpEx savings, 10% revenue uplift, and 15% fewer compliance incidents just in the first year.


These are impressive numbers and are reflective of a broader trend in the foodservice industry despite the fact that foodservice companies have unique challenges such as a large base of deployed equipment that require retrofitting, heterogenous equipment types, and poor connectivity infrastructure. The quick-service restaurant segment is not the only one experimenting with new connected technology; other segments such as coffee shop chains, retail & convenience stores, and commercial kitchens are also adopting IoT to drive improved food safety and quality assurance, for faster new recipe rollouts or to improve equipment reliability. The trend is evident not just in the fully owned store model but also in the franchise-based model.

Some of the key IoT-driven business outcomes include:

Food Safety & Quality Assurance: Sensor-based IoT solutions can monitor food preparation procedures and ensure they are followed consistently in adherence to policy. Any anomalies can be flagged and remediated to better manage risk and food quality.

Faster Recipe Rollouts: The foodservice industry is a competitive tight margin business where the smallest differentiators can make a difference. The ability to use automated over the air recipe updates from the cloud can speed up new offerings and keep the menu fresh, driving topline growth. Most importantly an effective recipe management system enables A/B testing of new recipes across markets.

Improve Equipment Reliability: Foodservice enterprises have a large base of deployed assets including ovens, ranges, fryers, coolers, soda machines among others - complex equipment with unpredictable failure patterns. Using IoT analytics to improve uptime means minimizing lost revenue and less business disruption. Equally, understanding the true cost of support for different products and product types can streamline decisions related to purchasing, warranties, and when to fix vs. replace.

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Overall, IoT can play a powerful role in enhancing business performance and guest satisfaction in foodservice organizations. By leveraging the power of sensors, cloud, analytics, and mobile applications, foodservice companies can gain an unfair competitive advantage and realize sustainable growth for the long term. However, one shouldn’t expect this innovation to come from the OEMs that supply the operators, it’s the equivalent of the fox guarding the henhouse since these equipment makers have much service & maintenance revenue at stake. The key to success is choosing a neutral platform provider that can reliably scale to managing millions of devices (equipment) across thousands of distributed locations, have the ability to work seamlessly across appliances from a variety of OEMs, and possess the analytical edge to transform the ‘big data’ from stores to perform advanced analysis for descriptive and prescriptive purposes.

Originally posted here

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