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Daily news and analysis about the food tech revolution

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McDonald’s is Creating Virtual ‘AI Managers’ for Its Restaurants

Want some AI with your Big Mac? McDonald’s is about to serve it up in a big way.

According to a story in the Wall Street Journal today, McDonald’s is undergoing a technology overhaul across its 43,000 restaurants, implementing internet-connected kitchen equipment, AI-driven drive-throughs, and tools for managers. McDonald’s is partnering with Google Cloud to deploy edge computing technology, allowing restaurants to analyze data locally rather than sending it to the cloud. This setup helps predict equipment failures—such as fryers or ice cream machines—before they occur and ensures order accuracy through AI-powered cameras.

We’ve written quite a bit at The Spoon about McDonald’s experimentation with AI at the drive-thru, but this story shows they are looking to use generative AI for customer interaction and beyond, including exploring generative AI virtual assistants to handle managerial tasks.

From the WSJ: Edge computing will also help McDonald’s restaurant managers oversee their in-store operations. The burger giant is looking to create a “generative AI virtual manager,” Rice said, which handles administrative tasks such as shift scheduling on managers’ behalf. Fast-food giant Yum Brands’ Pizza Hut and Taco Bell have explored similar capabilities.

This story comes just a day after Taco Bell talked up their own AI initiatives, including their ‘Byte by Yum’ AI tool designed to assist restaurant managers with tasks such as labor and inventory management. The AI can manage schedules, assist with drive-through orders, and suggest operational changes based on competitor activity, aiming to optimize employee efficiency without reducing labor costs.

New McDonald’s in Texas Has Conveyor Belts & Two Drive Thru Pickup Lanes

If you partake in restaurant or foodie TikTok, you’ve probably seen a viral video of the new McDonald’s concept restaurant in Forth Worth, Texas.

The video, posted on December 17th, shows off the location’s automated drive-thru and an empty lobby with a couple of lonely ordering kiosks. Comments feature the usual mix of outrage, cheering, and sarcasm.

For its part, McDonald’s has been publishing its own videos and blog posts about the new restaurant since the beginning of December. The video below shows off the unique features of the concept store and how it makes life for food delivery drivers and on-the-go customers easier:

The new location, run by second-generation McDonald’s franchisee Keith Vanecek, includes two drive-thrus, including one targeted at digital order customers called the Order Ahead lane. The Order Ahead lane utilizes a rotating vertical lift that brings the order from above and drops it onto a conveyor belt. From there, the conveyor belt shuttles the order to the customer, who picks it up through the window.

While it’s a bit reminiscent of the Taco Bell ‘dumbwaiter’ delivery chute unveiled earlier this year, it looks like the McDonald’s Order Ahead pickup is more akin to a second bank-teller window in that the customers’ order is sent across to the customer, and not -as is the case with the Taco Bell concept – put into the delivery chute from overhead by an employee working on the second level.

Whatever the mechanics, Micky D’s Order Ahead window is yet another signal that the big QSRs are beginning to embrace designs with multiple pickup points at a single location to avoid the order logjam that comes with a typical drive-thru design that zippers multiple order lanes into a single pickup lane.

Inside the store, in addition to kiosks, there’s a mobile order pickup shelving installation where customers can take and go their orders.

The new concept is another example of how QSRs are continuing to rethink the design of their locations as a larger share of their business goes through delivery and app-generated delivery. While this is the only McDonald’s location with these innovation concepts, the company has made it clear they plan to roll out ideas that they determine could benefit customers in other locations as part of their ‘Accelerate the Arches’ growth strategy.

McDonald’s Resistance to Ice Cream Machine Fix Strikes Discordant Note Amidst Chain’s Tech Stack Modernization Push

You know how they say it’s not what you know, but who you know? That’s doubly true if you’re trying to insert yourself into McDonald’s technology supplier network.

Just ask Kytch, a company that makes a device that fixes the burger giant’s perpetually broken ice cream machines. You’d think that McDonald’s would welcome such a fix since, after all, their ice cream machines are broken so often they’ve become meme-worthy.

Apparently not, as illustrated by the burger chain’s orchestrated email campaign warning franchisees to stay away from Kytch, claiming it violated the machinery’s warranty, intercepted confidential info, and suggested the device was dangerous to operators since it has a remote operation function. McDonald’s also used the email campaign to promote a new ice cream machine from Taylor (the manufacturer of the oft-broken machines), which promised to have similar remote management features as the Kytch appliance.

According to Kytch, the McDonald’s email campaign killed their business and severely hobbled plans to launch an entire line of connected kitchen products for pro kitchens.

From Wired:

Kytch cofounder Melissa Nelson says the emails didn’t just result in McDonald’s ice cream machines remaining broken around the world. They also kneecapped Kytch’s fast-growing sales just as the startup was taking off. “They’ve tarnished our name. They scared off our customers and ruined our business. They were anti-competitive. They lied about a product that they said would be released,” Nelson says. “McDonald’s had every reason to know that Kytch was safe and didn’t have any issues. It was not dangerous, like they claimed. And so we’re suing them.”

Kytch ended up suing Taylor last May for stealing trade secrets (according to the suit, Taylor worked with a franchisee to obtain a Kytch gadget and copy some features) and, just this month, the startup filed suit against McDonald’s.

So why would McDonald’s wage a war on something that, from all appearances, makes their customers’ and franchise operators’ lives better?

One reason could be that the chain earnestly believes the machine’s remote turn-on capabilities really do create a safety hazard. However, those concerns should have been eliminated once Kytch’s machine achieved UL certification.

Another possibility is that the device interfered with the steady revenue stream from Taylor’s maintenance contracts, which make up about a quarter of the equipment company’s revenue. I’m more inclined to believe this could be partially responsible for McDonald’s hesitancy, especially if Taylor had promised a new machine with some of the features of the Kytch.

Whatever the reason, the Kytch-McDonald’s kerfuffle illustrates how the chain’s internal motivations aren’t always aligned with that of their customers or franchisees when it comes to doing what’s best from a technology perspective. And this isn’t the first time the company’s technology management has struck a discordant note with franchise operators. Last year the chain’s franchisees pushed back against the chain’s high fees and centralized command and control of technology deployment. In the case of Kytch, it’s this very same rigid control of technology deployment that is robbing franchisees of a solution that one franchise operator said saved him “easily thousands of dollars a month” from lost revenue and repair fees.”

In their defense, McDonald’s has been working hard in recent years to upgrade their franchisees’ tech stack, including acquiring AI-powered personalization startup Dynamic Yield. Still, with all that investment in futuristic kitchen tech, you’d think the burger chain would want to make sure something as basic as a McFlurry-making appliance would work well, even if it meant embracing a fix from an upstart.

IBM Partners With McDonald’s, Acquires McD Tech Labs to Automate Drive-Thru Orders

Over the summer, McDonald’s announced that it was trialing automated ordering at 10 Chicago, Illinois locations. Now, it appears that we will be seeing automated ordering at more locations sooner than later. Today, IBM announced that it has partnered with McDonald’s to continue to develop automated drive-thru orders and acquired its proprietary McD Tech Labs. The financial details of the acquisition were not disclosed.

McDonald’s acquired Apprente, a voice technology company, in 2019, and shortly after developed McD Tech Labs based on Apprente’s tech. This technology uses artificial intelligence to process drive-thru orders and then sends the order to the kitchen, where it is fulfilled by staff.

What is the benefit of using an AI-powered ordering system? In the trial run at the Chicago locations, McDonald’s found an 85 percent accuracy rate with orders and about 20 percent of orders needing staff assistance. AI can also help reduce customer wait time and free up employees to assist elsewhere in the restaurant.

In addition to the acquisition of McD Tech Labs, IBM will assist in the continued development of the Automated Order-Taking (AOT) technology and work on additional languages and dialects.

Consumers have traditionally voiced a certain degree of hesitancy in interacting with artificial intelligence. However, in Datassential’s AI & Menus report, it found that 43 percent of consumers found voice ordering technology unappealing initially, but after experiencing it, 68 percent were satisfied with the tech.

McDonald’s operates nearly 14,000 locations throughout the U.S, and it was not disclosed when a large rollout of the AOT technology might occur. IBM stated in the press release that it will help the quick-service chain accelerate the deployment of the AOT technology across different markets.

The Alt Protein News Round-Up: Cultured Pork in China and McPlant Burger’s Launch

If you haven’t had the chance to check it out, The Spoon was given an exclusive virtual tour of Rebellyous Foods’ production facility, where it manufactures its plant-based chicken. Speaking of which, we have some news about Rebellyous Foods’ school cafeteria launch, CellX’s cultured pork unveil, the official launch of the McPlant burger, and Equinom’s new partnership.

CellX unveils cultured pork and shares goals for price parity

China-based cultured meat producer CellX revealed its cultured pork product this week, which uses cells extracted from the country’s native black pig. The alternative pork product was incorporated into various dishes and served to potential investors. Pork is the most consumed meat in China, but the country has experienced supply chain issues due to the pandemic and an outbreak of African Swine Fever amongst herds. The company’s goal is to reach price parity with conventional pork by 2025.

Rebellyous plant-based chicken nuggets to be served in public schools

Rebellyous Foods, a producer of plant-based chicken tenders, nuggets, and patties, shared this week that its alternative nuggets will be making their way into public school cafeterias in Washington and California. The first school to supply the nuggets was Ramon Valley Unified School District (SRVUSD) in Northern California last year, and the five new school districts to do so are Dublin Unified, Livermore Joint Unified, Santa Ana Unified, Pleasanton Unified, and Everett Public Schools. The “Kickin Nuggets” were developed specifically for K-12 food service and are made from a base of soy protein.

McPlant burger launches in McDonald’s throughout the UK

Starting September 29th, select McDonald’s locations in the UK will begin rolling out the highly anticipated McPlant burger, which is now 100 percent vegan. The meat-free patty was made in partnership with Beyond Meat, and the burger will also include vegan cheese, mayo, lettuce, tomato, mustard, ketchup, and pickles. McDonald’s previously ran trials of the McPlant in 2020 in various countries, and at that time, the burger was vegetarian but not vegan. The McPlant will become available nationwide starting in 2022.

Equinom to partner with Meatless farms as a supplier

Equinom, a nutrition company that uses AI to improve the nutrition content of seeds, disclosed this week in a press release sent to The Spoon that it will begin supplying Meatless Farm, a plant-based meat brand, and its ingredient subsidiary Lovingly Made Ingredients. Meatless Farms will use Equinom’s pea protein concentrate in a variety of its products, boosting the protein content by up to 50 percent. This is the first plant-based company that Equinom has partnered with.

Wild Earth Launches Cell-Based Petfood

Plant-based pet food brand Wild Earth has announced plans to expand its product line into pet food made with cell-based meat. The announcement comes on the heels of a new $23 million funding round from a group of investors that includes Mark Cuban and the star of Vampire Diaries, Paul Wesley.

Led by alternative protein entrepreneur and investor Ryan Bethencourt, Wild Earth has been one of the early leaders in creating pet food from plant-based ingredients. With products like Clean Protein dog food (which uses pea and potato protein) and Superfood Dog Treats With Koji (Koji is a fungi protein used in fermented food in Asia), company sales have grown more than 700% year over year, according to a release sent to The Spoon.

I Taste Tested the Impossible Chicken Nugget Against Three Other Brands. Here’s How It Fared.

You may have heard that Impossible Foods plant-based chicken nuggets are available today at select restaurants. To generate a little buzz for today’s launch, the company behind the Impossible Burger offered to send bags of the new plant-based nuggets to journalists around the country. Not being one to pass up free nuggets, I was happy to try them out.

To make things interesting, I decided to give Impossible a little competition with a side-by-side taste test against two chicken meat nuggets (Tyson and McDonald’s) and another plant-based nugget (Incogmeato).

My nugget taste test was a family affair. Participants included my son and daughter, the true experts in the family on chicken nuggets.

Both kids tasted them blind. There were two things I wanted to know with a blind taste test: First, could they tell the difference between the animal meat nuggets and plant-based nuggets? Second, what did they think of each nugget’s flavor? I also tried each nugget (non-blind, of course) to compare and contrast with the new Impossible nugget.

I cooked a batch of each frozen nugget in my oven for the time specified on each bag. While I generally prefer to cook nuggets and other prepackaged freezer food in an air fryer (see my note at the end), for the taste test, I wanted to use the method most consumers still use when they get the nuggets home. As for the McDonald’s nuggets, I had a friend run through a McDonald’s drive-thru while I was cooking the other nuggets so they would still be warm.

Soon the nuggets were all plated and ready to be dipped.

The Nuggets: Impossible (yellow), Incogmeato (pink), McDonald’s (green) and Tyson (blue).

We started with the Incogmeato. Both kids knew right away it was a plant-based nugget. And while they thought it was passable, neither loved it.

“I like the spices,” shrugged my son.

I thought the Incogmeato nugget was fine, but I also could tell it was a plant-based nugget. I also thought the outside was a bit spicier than the other nuggets.

Next up was McDonald’s. Both kids guessed these nuggets were from Mickey D’s, in part because they’ve each eaten them a hundred times over their lifetimes, but also because they looked like McDonald’s nuggets.

The McNuggets have what looks like a fried batter coating, which sets them apart from the frozen home-cooked nuggets which all have breading on the outside. As it turns out, it was this outside coating that saved the McNugget in our taste test. Both kids like the batter-y coating.

“Good outside,” one of them said.

So what didn’t they like about McDonald’s chicken nuggets?

“The chicken is not that good,” my son said.

“That’s my thing,” agreed my daughter. “The chicken kinda ruins it for me.”

My thoughts on the king of fast food nuggets? Not that great. The chicken inside was dry and a bit spongy, and I didn’t really like the outside batter.

Now it was Tyson’s turn. Perhaps not surprisingly, it turns out the biggest maker of frozen chicken food products knows what they’re doing when it comes to nuggets:

Both kids liked these nuggets the best.

“My favorite is this one,” said my daughter.

Her brother nodded. “This is only one that is definitely chicken.”

I agreed with them that the Tyson nugget was good.

Finally, it was time for the Impossible. What did my kids think? Both liked them.

“The flavor is great,” said my daughter.

“It’s really good,” said her brother.

They both suspected the Impossible nuggets might be plant-based, but they weren’t completely sure. In the end, though, it really didn’t matter to them since they both said they’d definitely eat them again.

For my part, I thought the Impossible nuggets were delicious. The plant-based meat tasted like real chicken. The breaded outside was tasty, just like the Tyson nugget. A parent could serve these, and any nugget-loving kid would scarf them up.

After all was said and done, here’s how the nuggets ranked in our taste test:

  1. Tyson – the best tasting nugget. The chicken was moist and the breaded outside was crispy.
  2. Impossible – A close second with yummy plant-based meat that tasted like the real thing and a nicely breaded outside.
  3. McDonald’s – The kids liked them, I suspect out of childhood nostalgia and sheer muscle memory. These were my least favorite.
  4. Incogmeato – No one disliked them, but my kids just like them less than the other nuggets. I thought they were fine, but I thought the Impossible was definitely better.

Bottom line: This is a good performance for Impossible. The nugget, which uses soy as its main ingredient (as does Incogmeato), is nearly indistinguishable from a real chicken nugget and is both kid and parent-approved.

If you or your kids are chicken nugget fans, I would definitely recommend trying out the Impossible nuggets. And heck, why not even have your own taste test?

Finally, an updated serving suggestion. The next day I tried the Impossible nuggets in the air fryer (10 minutes). As suspected, the results were much better. The outside was crispier than my oven batch, and the inside was juicy. I’d definitely recommend using the air fryer for the Impossible (and any other nugget).

Following Tensions, McDonald’s Cuts Tech Fees for Franchisees by 62 Percent

McDonald’s will cut technology fees for its U.S. franchisees by 62 percent following a third-party review of of billing, according to a report from Bloomberg. 

The original $68 million was announced in December of 2020, when corporate said it would charge franchisees a $423-per-month fee to cover a lag in outstanding technology fees. Outrage ensued from franchisees, who have pushed back against some of McDonald’s tech-related decisions in the past.

Those clashes have included everything from store design overhauls to disputes over delivery. At the same time, McDonald’s has been aggressively pursuing new technology implementations in an effort to digitize its fast-food business. It acquired AI company Dynamic Yield and voice-tech company Apprente in 2019. And though the chain has downgraded its Dynamic Yield implementations of late, it appears to be increasing its efforts around voice tech. McDonald’s latest move has been to implement voice-order technology at 10 stores in Chicago in an effort to automate more of the drive-thru experience for customers. At the time of that announcement, McDonald’s CEO Chris Kempczinski suggested we’ll see voice-ordering at all McDonald’s in the next five years.

Additionally, McDonald’s is one of the many QSRs to release new store designs following 2020’s upheaval. Future locations could prioritize formats like drive-thru and curbside pickup, and emphasize mobile ordering and more tech in the drive-thru lane(s).

Franchisees have argued against some new technologies in the past. It remains to be seen how onboard they will be with further digitization of the business in light of this new agreement with corporate. 

Franchisees own about 95 percent of all McDonald’s locations in the U.S.  

McDonald’s Testing AI-Powered Drive-Thrus in Chicago

McDonald’s has started testing out drive-thrus that use artificial intelligence systems, rather than humans, to take orders. CNBC reported yesterday that the new automated drive-thrus are in use at 10 Chicago McDonald’s locations.

The new system is based on the voice platform built by Apprente, which McDonald’s acquired in 2019. According to McDonald’s, restaurants using the system are seeing an 85 percent order accuracy rate, with only about one-fifth of orders requiring human intervention.

AI-powered drive-thrus can reduce customer wait times and allow restaurants to shift its in-store workforce. A computer that understands natural language is always on and available to take orders. It could also be tied in with other automated systems that know a customer’s purchasing history to automatically make recommendations. With improved understanding accuracy, a restaurant would no longer need a dedicated person to take (or confirm) a drive-thru order, allowing more people to do more customer service or expedite orders.

McDonald’s CEO Chris Kempczinski told Alliance Bernstein’s Strategic Decisions conference that a big issue ahead for the AI-powered drive-thru is scaling. CNBC reports Kempczinski as saying “Now there’s a big leap from going to 10 restaurants in Chicago to 14,000 restaurants across the U.S., with an infinite number of promo permutations, menu permutations, dialect permutations, weather — and on and on and on.”

The Apprente acquisition appears to be working out better than Dynamic Yield, which McDonald’s also acquired in 2019. Dynamic Yield generated automated menu recommendations based on factors like weather, and was supposed to be integrated into self-service kiosks and drive-thrus as well. However, this tech didn’t yield the results McDonald’s was looking for and in March of this year The Wall Street Journal reported McDonald’s was looking to sell part of Dynamic Yield.

While McDonald’s Apprente acquisition may have pre-dated the pandemic, last year certainly accelerated the need for enhanced drive-thru technology as dining rooms were forced to shut down. In a February 2021 survey, BlueDot reported that 91 percent of respondents said they had visited drive-thrus the previous month and that long wait times were a “dealbreaker.” Most major QSRs have been doubling down on their drive-thru capabilities to meet this demand, adding capacity and building restaurants around takeout rather than dine-in.

In addition to adding AI assistants, McDonald’s has previously said that it will add other features to its drive-thru such as express lanes for digital orders and conveyor belts to carry food out to customers.

Kempczinski also told the conference that McDonald’s is also exploring ways to automate parts of the kitchen such as the grill or fryer. However he said any such move in the back of the house is still a more than five years out as the technology is too expensive right now.

Beyond Meat Going More Mainstream with McDonald’s, Yum Brands Deals

Beyond Meat announced global distribution deals yesterday with McDonald’s and Yum Brands (KFC, Pizza Hut, Taco Bell) that will help push plant-based meat further into the mainstream.

Beyond and McDonald’s had previously revealed that they were working together on the appropriately named “McPlant” sandwich back in November. The McPlant debuted in 2019 in Canada and is currently being tested in select markets around the world. The two companies will extend their collaboration beyond plant-based burgers, as the McPlant is actually a “platform” for a variety of different products. Beyond will work with Mickey D’s to create plant-based options for chicken, pork and egg.

Likewise, Beyond’s deal with Yum Brands builds on an existing collaboration between the two companies. KFC introduced the plant-based Beyond Fried Chicken in Atlanta in 2019, and has since expanded that pilot to other U.S. cities. Last year, Pizza Hut launched the Beyond Italian Sausage Pizza and Great Beyond Pizza nationwide.

Beyond has been on a bit of roll with high-profile partnerships this year. Last month Beyond partnered with PepsiCo to form the PLANeT Partnership joint venture that will develop plant-based snacks.

All of these deals are obviously huge news for Beyond Meat, specifically, as it looks to grow its plant-based empire. It also alters the competitive landscape with its plant-based burger rival, Impossible Foods. Throughout 2020, Beyond and Impossible made back-and-forth news announcements around expanding retail, launching direct to consumer channels, and restaurant partnerships. For its part, Impossible, which launched its burgers at restaurants, has deals with Burger King, White Castle and Starbucks here in the U.S.

But Beyond’s expanded partnerships with giants like McDonald’s, KFC, Taco Bell and Pizza Hut is perhaps even bigger news for plant-based meat in general. Though sales of plant-based meat are on the rise and steadily gaining traction, being on the menus of these huge, global QSR chains will help give the entire sector a massive boost both in terms of sales and recogntion.

McDonald’s Starts Testing McPlant Burger in Europe

McDonald’s plant-based burger, co-developed with Beyond Meat, is officially on the chain’s menus in Denmark and Sweden, according to a company press release (h/t LIVEKINDLY).

As with other Beyond products, the primary protein ingredient in the McPlant is pea protein, with rice protein a secondary ingredient. The product is for sale as a burger topped with lettuce, cheese, tomato, pickle, onion, mayonnaise, mustard, and ketchup. 

Staunch vegans beware, though: according to Bloomberg, the patty is cooked on the same grill as McDonald’s regular beef burgers. For those trying to avoid any kind of animal-based protein, this will likely be a major turnoff, though customers buying plant based patties for more environmental reasons may not find the situation as problematic. Burger King faced a similar issue with the Impossible Whopper, and customers can now request their plant-based order be cooked on a different grill. It is unclear if McDonald’s will offer a similar choice.

McDonald’s is one of the last of the major QSRs to offer a plant-based option on its menu, outside of a test the chain did with Beyond in Canada in 2019. When McDonald’s made the initial announcement around this new burger back in November, it was unclear that Beyond was even involved as the supplier. While that issue has been clarified for now, it’s equally unclear whether Beyond will continue supplying the plant-based patties for a wider McPlant rollout, or if/when said patties will be coming to the U.S.

The McPlant trial is currently taking place until March 15 in Sweden (in Linköping and Helsingborg) and April 12 in Denmark. Few details have been offered as to whether Beyond will continue to be the supplier as McDonald’s releases plant-based menu items to a wider audience.