Restaurant owner: Automated drive-thrus trump $15 wages for business – Business Insider

A fast-food franchisee says she's turning to automated drive-thrus to solve her labor shortage, rather than offering a $15 hourly wage to attract new staff.

Shana Gonzales, a Checkers franchisee who owns four restaurants in the Atlanta area, told The New York Times that she wanted to hire more workers, but that it wouldn't be profitable. She said raising wages to $14 or $15 would allow her to fully staff her restaurants but that she'd have to raise menu prices, which could deter customers.

Instead, she's turning to automated technology, such as voice-recognition drive-thrus, to keep business booming, she said.

The US is suffering from a severe shortage of workers, and restaurants have been especially hard hit. The US Chamber of Commerce has called the shortage a "national economic emergency" and warned it could hold back the recovery from the pandemic.

Read more:These 9 food tech startups are capitalizing on the labor crunch with tools that help franchisees hire or automate the restaurant workforce

Gonzales told The Times that she had raised wages to around $10 for entry-level workers, from around $9 pre-pandemic. But she found it difficult to find enough workers to meet soaring fast-food demand during the pandemic, she said, and had to work behind the cash register herself.

"We really felt like there has to be another solution," she said.

She turned to automation. In December, she started using technology from Valyant AI, a startup that makes voice-recognition systems for restaurants, to take orders at one of her drive-thru lanes. The technology takes orders, including noting modifications and suggesting add-ons, and feeds this directly to the kitchen and cashier.

Gonzales is planning to roll out Valyant's technology at her three other restaurants, she said.

"We'll look back and say why didn't we do this sooner," she told The Times.

Even before the pandemic, restaurants had been turning to digital ordering to keep staff costs down because of rising wages in the restaurant industry, Andrew Lapin, a lawyer specializing in retail at Robbins, Salomon, and Patt, told Insider.

Former McDonald's CEO Ed Rensihas said that the push for a $15 federal minimum wage could cause fast-food chains to raise prices or slash jobs by turning to automation instead.

"Technology is always cheaper than people," he toldFox Businessin June.

McDonald's is testing out voice-recognition software at some drive-thrus in Chicago, while other restaurants like Starbucks, Panera Bread, and Burger King are pushing customers to order using apps, QR codes, and digital kiosks, reducing the need for servers.

But Gonzales, the Checkers franchisee, told The Times that she doesn't view technology as a replacement for workers and instead sees it as a way to let staff focus on customers instead.

"Our approach is, this is an assistant for you," she said.

The tight labor market is causing some businesses tocut operating hours, slash production, and raise prices, while others have been offering higher wages,sign-on bonuses, and evenfree fitness machinesandiPhonesto attract new hires.

Got a story about how your business is overcoming the labor shortage? Email this reporter at gdean@insider.com.

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Restaurant owner: Automated drive-thrus trump $15 wages for business - Business Insider