Close Ad

The Spoon

Daily news and analysis about the food tech revolution

ShiftPixy

Landed Raises $1.4M, Launches App to Make Hiring Simpler for Restaurant Managers

San Francisco, California-based restaurant tech company Landed announced the official launch of its mobile app that connects hourly restaurant and retail workers with potential employers. The company has also raised a $1.4 million seed round led by Javelin Venture Partners, Y Combinator, Palm Drive Capital, with angel investors also participating in the round.

Landed says it uses a combination video interviews and an “intelligent matching algorithm” to match restaurant job candidates with the most relevant employers. Job seekers download the app, and fill out a profile, including a short video recording, which essentially acts as a digital resume. Candidates are evaluated by Landed’s system based on over 50 data points, among them communication skills, body language, and work longevity. Depending on what an employer wants, Landed can prioritize certain data points over others.

On the hiring side, restaurant managers download the Landed app and input their hiring goals like head count, pay rate, and location(s). Much of the hiring process is then automated: the app can automatically schedule interviews, follow up with candidates, and organize potential employees.

Founder Vivian Wang got the inspiration for Landed after years of working in the retail industry, where turnover rates are typically over 100 percent. Restaurant jobs are similar. Restaurants are also under pressure to make their operations as efficient as possible now that the COVID-19 pandemic has decimated the traditional model. Managers of multi-unit chains, in particular, could benefit from a more streamlined hiring process. The tech-driven model Landed offers restaurants is similar to that of ShiftPixy, which also works with large, multi-unit chains.

Landed’s current customer base includes franchisees of Wendy’s, Chick-fil-A, and discount supermarket Grocery Outlet. The app is currently available in seven metro areas: Atlanta, Reno, Dallas-Ft Worth, Scottsdale/Phoenix, Virginia Beach, and Northern and Southern California.

In-House Delivery Needs to Disrupt Delivery

Some of the talk at last week’s Smart Kitchen Summit revolved around two newish concepts that are especially compelling when it comes to thinking about restaurants: in-house delivery and disrupting third-party delivery. Together, the two could substantially shift the the off-premises meal journey of the future.

Technically, in-house delivery — also called “native delivery” or “direct delivery” — is a decades old practice championed by Domino’s, Jimmy John’s, and other restaurants that have always used their own staff to ferry orders to customers’ doorsteps. But ever since customer demand for delivery went through the roof and then some, most restaurants have found it more economically feasible to offload delivery operations to third-party services like DoorDash and Uber Eats. 

As we cover ad nauseam around here, third-party delivery comes with its own lengthy catalog of grievances, and many restaurants don’t actually make money from those orders. On top of that, they lose control of customer relationships and oftentimes their own branding. 

In-house delivery 2.0, then, is all about restaurants bringing some of that control back under their own rooftops. One SKS panelist mentioned fast-casual chain Panera as a pathbreaker in this area, as the chain still uses its own drivers for many of its orders and only offloads the technical logistics of processing an order to third parties. Bloomin’ Brands, parent company of Outback Steakhouse and Carrabba’s, also handles many of its delivery orders in-house, and Panda Express recently launched its own program that handles the entire delivery journey, from order processing to food transport.

Simultaneously happening is the rise of services like ShiftPixy, which use their technology to power custom-branded websites for restaurants that can process ordering and payments. ShiftPixy also works with restaurants to provide them with drivers, erasing third-party delivery from the process.

All of these approaches to in-house delivery were mentioned during SKS. In a discussion about the rise of ghost kitchens and virtual restaurants, one set of panelists agreed that in the future we will see a wider range of restaurants — major chains and independent mom-and-pop stores — gravitate to in-house delivery as a way of controlling their customer relationships and branding, to say nothing of dodging predatory commission fees from third-party services.

The mention of mom-and-pop shops is important to note. Right now, most can’t afford to build out their own mobile ordering and payments system and pay employees to deliver the food. That territory currently belongs to the Paneras and Panda Expresses of the world, which brings me to our second point: disrupting third-party delivery.

At SKS, more than one person I spoke to predicted that the act of unseating third-party delivery apps’ dominance over restaurants won’t come from imposing more rules and regulations, but from someone bringing a better, cheaper solution to the table. As more restaurant chains with deep pockets take back more of their delivery stack, those solutions might very well surface in the process. 

This is the web version of our weekly newsletter. Subscribe to get all the best restaurant tech news delivered direct to your inbox.

Del Taco Is Launching a Drive-Thru-Only Concept

Following in the footsteps of KFC, Chipotle, Burger King, and other chains, Del Taco is doubling-down on the drive-thru as an important source of sales in the future. The Lake Forest, Calif.-based chain announced on its recent Q3 earnings call it will build a drive-thru-only prototype that can be placed at Del Taco locations with a smaller physical footprint. CEO John Cappasola said during the call this prototype will include “a modernized design, improved functionality, and other operational enhancements,” though he didn’t get more specific than that.

If this story sounds somewhat familiar, it’s because other chains have made similar announcements in the recent past. Most notable among them is Burger King, who several weeks ago announced its own drive-thru-centric design prototype meant to take up less physical space and serve more drive-thru orders in a shorter amount of time. 

Drive-thru has been the most important sales channel for QSRs during 2020’s lockdowns and continued uncertainty over the dining room. However, QSR Magazine’s recent 2020 Drive-Thru Study found that drive-thru times are nearly half a minute slower than they were last year, so it’s not a surprise more chains are redoubling their efforts to make the experience faster and more efficient. With winter fast approaching, outdoor dining is about to get way less appealing to consumers in many regions. Chains will need every order they can get from drive-thru, curbside, and other off-premises channels to make up for lost sales in the dining room/patio over the next several months.

Restaurant Tech ‘Round the Web

A wider slowdown could erase up to 2 million jobs restaurant and retail, according to new research from Gusto cited by Restaurant Dive. The losses could total roughly $190 billion.

Following openings this year of three off-premises stores in Chicago, P.F. Chang’s will expand its to-go-concept to 27 locations by 2021. The company is also testing an in-house delivery service at 10 of its locations in the U.S.

As we reported this week, Burger King is piloting reusable cups and sandwich containers in New York, Portland and Tokyo next year. The program is being done in partnership with TerraCycle’s Loop, which is also doing the McDonald’s reusable cup trial in the U.K.

Ordrslip Adds Postmates Integration to Its Mobile App Software for Restaurants

Restaurant tech company Ordrslip announced today it has partnered with Postmates to add delivery integration into its mobile app software, according to a company press release sent to The Spoon. Per today’s announcement, Ordrslip’s software lets restaurant customers “create custom-looking whitelabel mobile ordering applications via Ordrslip.”

It’s no secret that, since the pandemic pushed the restaurant industry to off-premises formats, usage of mobile apps for ordering and payments is on the rise. It’s also pretty commonly known at this point that sophisticated apps a la Starbucks are far too expensive and resource-consuming for most independent restaurants and chains to create themselves. Hence the growing selection of tools (see below) various third parties offer to get restaurants the digital properties they need without decimating their already decimated margins.

The Ordrslip approach is this: Ordrslip creates a branded mobile app for the restaurant with all the features needed to fulfill pickup and delivery items, including order-ahead capabilities, payments, iOS and Android compatibility, POS integration (only with Square and Clover for now), and order tracking. You can read the full list of features here. The app looks and functions as if it belongs to the restaurant but is powered by Ordrslip’s softare in the background. As of today, there is the option to add Postmates integration in order to fulfill the last-mile delivery end of the operation.

The promise is that by using Ordrslip with the new Postmates integration, restaurant customers can bypass the controversial per-transaction commission fees they normally get charged by third-party delivery services. Ordrslip pricing is $100/month per location or $1100/year per location, with one-time setup fees of $1,000 and $750, respectively. (The setup fee applies to all locations a restaurant might operate.)  

On the one hand, those are high numbers for already struggling restaurants, which would have to be doing enough delivery to surpass $100/month in commission fees per transaction. On the other, there’s a pandemic happening and folks are staying at home and ordering more delivery. In other words, $100 in commission fees to Grubhub Et al is probably on the low end these days, though restaurants still have to pay some commission to Postmates for delivering the order.

Ordrslip is one of a growing number of companies offering restaurants workarounds to 30 percent commission fees on delivery orders. POS platform Toast, ChowNow, and many others have various tools in the market that let restaurants process orders and payments through a separate platform so they only need to use the delivery service for actual deliveries. Another company, ShiftPixy, bypasses delivery services altogether and provides the drivers itself. And even the delivery services themselves are participating in this trend. Uber Eats is piloting a tool that lets restaurants process orders through their own platforms, though Uber Eats retains the customer data.

Uber Eats also just announced its plans to buy Postmates for $2.65 billion, a deal that is expected to close in the first quarter of 2021. That deal is unlikely at this point to affect a partnership like the one Ordrslip announced today.

ShiftPixy Launches Ghost Kitchen Incubator

Gig economy engagement platform ShiftPixy announced today the launch of its Ghost Kitchen Incubator Project, which will provide advice and infrastructure to restaurants wanting to launch and/or improve their off-premises strategies. 

The incubator is part of ShiftPixy’s new Labs offering, which is a suite of marketing and support services designed specifically for QSRs. ShiftPixy says that through it, restaurants can get insights and advice on what exactly they need to operate an off-premises business. Via the Incubator Project, that means access to physical kitchen space as well as ShiftPixy’s technology, which connects restaurants to delivery drivers and couriers.

ShiftPixy differentiates itself from third-party delivery services like DoorDash or Uber Eats by hiring these gig workers (“Shifters”) as W-2 employees and facilitating the connection between them and the restaurant. Meanwhile, ShiftPixy’s tech platform doesn’t act as a consumer-facing marketplace for food delivery. Rather, it powers the back end of restaurants’ native mobile apps.

For those restaurants, the benefits of a system like ShiftPixy’s is avoiding the high commission fees associated with other third-party services and retaining customer data because orders are coming through their own digital properties. 

The benefits of this alternative delivery model are attractive at a time when most restaurants have been forced into doing delivery and other off-premises formats as a means of survival. Ghost kitchens, too, are growing more popular thanks to the pandemic, which has shuttered many restaurants and is now making many rethink how important the dining room is to their overall livelihoods. 

In the QSR realm, ghost kitchens are becoming especially prevalent, with Starbucks, Fat Brands, The Halal Guys, Chick-fil-A, Wendy’s, and an ever-growing list of others either turning their own stores into ghost kitchens or renting space from third-party kitchen providers.

But, as we discussed at length in The Spoon’s recent report on ghost kitchens, not every QSR needs one. And of those that do, the specific requirements for equipment, location, menu items, and other factors will vary from one chain to the next. 

ShiftPixy will undoubtedly address these and other issues through its new Incubator. Company CEO Scott Absher said in today’s press release that “if operators want to survive, they need to re-think their business processes, customer engagement and their approach to real estate.”

ShiftPixy hasn’t yet given full details on the new facility or said if any specific QSRs have yet signed onto the Incubator program. The company says it will “continue to issue updates” in the coming days, so stay tuned. 

Coffee Bean & Tea Leaf Is the Latest Chain to Embrace Direct Delivery

The Coffee Bean & Tea Leaf announced today via press release the launch of its newly redesigned mobile app. Among updates to the UX and improvements to the chain’s digital rewards program, the standout feature of the redesign is direct delivery.

As a quick refresher, direct delivery is when a chain can process orders made for delivery directly through its own digital properties (i.e., app and/or website), rather than having to go through a third-party service like DoorDash or Uber Eats. The big upside here is that restaurants pay a lower commission fee to third-party services because DoorDash Et al. are only handling the actual delivery of the food, not the order processing and technical logistics. The Coffee Bean & Tea Leaf currently delivers through Postmates to California and Arizona. 

The new app can process delivery orders directly. Other features, according to today’s press release, include an order-ahead menu for pickup orders at physical stores, the ability to scan, earn, and redeem points from the app’s home screen, and more customization capabilities for food and beverage items.

Coffee Bean & Tea Leaf’s app revamp comes at a time when digital properties are the main channel through which most restaurants are connecting with customers. A rise in COVID cases coupled with extremely uncertain economics has forced restaurants to rethink their approach to the digital realm. Keeping a customer (and their data) entrenched firmly in a chain’s own ecosystem is becoming increasingly important, and is one of the drivers behind this adoption of direct delivery. Coffee Bean & Tea Leaf is the latest brand to adopt this strategy, but plenty others already offer a similar approach to delivery. Panda Express recently announced the launch of its own delivery service. Outback Steakhouse and Wendy’s offered direct delivery long before the pandemic.

The move towards direct delivery doesn’t just mean potentially better margins for restaurants. It’s also fueling the growth of a specific area of restaurant tech, namely delivery integrators that sell out-of-the-box tech solutions to help restaurants bring some functions around delivery back in house.

Coffee Bean & Tea Leaf did not say in the press release if it has redesigned its app completely in-house or if it used technology from a third party like ShiftPixy. But it’s entrance into the direct delivery space is a sign that we’ll see similar moves from other regional chains in the near future as the dining room reopening remain in a constant state of flux.

Coronavirus is ‘a Wakeup Call’ for Restaurants When It Comes to Their Customer Data

Of all the tidbits of advice and information to come up in conversation with restaurants over the last few weeks, “communicate with your customers” is across the board the most popular mantra uttered.

There’s just one problem. In a restaurant industry currently powered by off-premises orders largely fulfilled by third-party services like Grubhub and DoorDash, restaurants can’t communicate directly with their customers because they have no data on who those people actually are.

One restaurant tech cofounder and CEO — namely Scott Absher of ShiftPixy — believes now is the time for restaurants to rethink the way their approach to customer data. Among other things, the crisis stemming from the novel coronavirus should be a wakeup call for these folks about how they treat their customer data — and how willingly they part with it.

Recently over the phone, he noted restaurants should “own those relationships” with customers and that “they need to rethink how they’re connecting digitally with their customers.”

Say a restaurant wants to promote pickup orders, which unlike third-party delivery can actually make restaurants a little money right now. Said restaurant might even offer some special deals or promotions for customers who order through the businesses own mobile app and opt to pick up the order. Trouble is, if the restaurant has left most of its off-premises management to Grubhub, it won’t have a way of communicating those deals in the first place. Customers may not even know the restaurant has its own mobile app that’s an alternative to Grubhub. 

Absher, who spends a lot of time talking to restaurants and has of late heard “some really frightened conversations,” believes now is the time to rethink both the concept of restaurant tech and the role customer data plays within it.

He calls this “destiny technology.” Websites and mobile apps are real estate customers visit just as they would a brick-and-mortar location. They will form opinions about their overall experience and share those opinions with others, and a restaurant should have access to that feedback much as they would have had to a comment card in the ‘80s.

“This is your new frontier,” Absher says. “It’s just as important as [physical] location is.” 

ShiftPixy has some skin in this game. Outside of being a platform for restaurants to find on-demand workers to fill shifts and combat turnover, the company also helps restaurants get up and running with delivery. Its own architecture runs behind the scenes of a restaurant’s in-house mobile app, which means instead of relying on Grubhub et al for delivery, restaurants can pay ShiftPixy a flat fee to manage the technical logistics of delivery orders and provide drivers. More important, because orders go through a restaurant’s own app, those businesses are keeping their own data.

The debate over who should own restaurant customer data isn’t new; COVID-19 just intensified it.

Right now, of course, many restaurants are just struggling to keep their doors open in some capacity. But with every new story that suggests an abuse of power on the part of third-party delivery companies, the question of who gets to own restaurant customer data (including menu prices, in some cases) becomes ever more important. And with mobile orders expected to proliferate in the post-pandemic restaurant industry, expect an uptick in solutions that promote native restaurant apps and offer businesses more control over their own data.

ShiftPixy’s Delivery Tech Promises Restaurant Chains More Brand Control

If the last year was was all about restaurants realizing they must do delivery, the next 12 months will be about how they’re doing it, and this question in particular: Do you go with a third-party service à la Uber Eats, or go it alone?

Those in favor of third-party delivery cite increased visibility, lower costs (you don’t have to hire your own driver fleet), and fewer technical responsibilities. Others say they will never use it because of the lack of control over service and brand integrity that happens when one signs on with a third-party service.

Over the phone last week, ShiftPixy cofounder and CEO Scott Absher seemed to agree with the latter argument: “How could a brand that has spent maybe billions of dollars over decades or generations to curate their brand suddenly surrender that brand and their customer experience and data to a kid in a red golf shirt and cap?” he asks.

He went into detail with me about how a restaurant’s choices no longer have to be the kid in the golf shirt or no delivery program at all. There’s a new middle ground afoot, and ShiftPixy is helping to establish it.

The Irvine, CA-based company makes a software stack for restaurants that was originally designed to help businesses combat high employee turnover. According to demos shared by ShiftPixy, when a restaurant signs up with the company, they are given access to a network of workers, called “Shifters.” The ShiftPixy app uses AI to rigorously onboard these Shifters, who undergo the same vetting any job candidate would, including background checks and providing proof of citizenship, driving records, and other details. Once approved, these Shifters become W-2 employees not of the restaurant but of ShiftPixy. When the restaurant needs to fill a shift, they can notify their network of nearby Shifters, who pick up work in much the same way Uber drivers pick up people to drive to the airport.

But Absher, who helped found the company in 2015, says ShiftPixy quickly became acquainted with what he calls the “dark side” of third-party food delivery: incorrect food orders, cold or poor-quality food, orders never arriving, and angry customers galore, to name a few. More importantly, users were getting frustrated with the brands themselves, though none of the ordering or fulfillment took place within a restaurant chain’s ecosystem.

“All of that anger was rolling back on those multi-unit operators,” he says, referring largely to national chains. But, he adds, these chains, “didn’t even know when a customer [was] angry so they could fix it.”

So ShiftPixy built a delivery component for its technology. For restaurants that use it, the ShiftPixy architecture works behind the scenes of a restaurant’s consumer-facing app to notify drivers of potential orders. This isn’t terribly different from the way any other third party operates the last mile of food delivery. It’s still a kid in a golf shirt picking your food up and dropping it at the door.

What is different is the slew of potential benefits restaurants — larger chains and their franchisees in particular — could reap from this arrangement. Through the deal they set with ShiftPixy, they’re not paying a fee on each and every delivery transaction made on a given day the way they would with Grubhub or Uber Eats. Most big-brand franchisees are locked into certain pricing structures and policies — having to choose a specific food distributor, for example — they can’t just dump to offset the cost of those fees. So a system that does away with them entirely could mean these restaurant operators reap the benefits of delivery without incurring the financial setbacks of working with traditional third-party services.

And while restaurants still can’t control what happens to the food when the driver picks it up, they can at least control the brand, and be aware of potential issues. When a restaurant uses ShiftPixy, customers don’t leave the brand ecosystem to order and pay for their meal, or to leave feedback or contact customer service. It all happens within the restaurant’s own mobile app, with ShiftPixy in the background, powering the last-mile logistics aspect. This, Absher reasons, could go a long way towards helping brands with their image. “The issue is brand integrity and the customer experience. As soon as that order goes out the door you’ve surrendered your customer experience,” he says.

This is a larger trend we’ll start to hear more about as delivery becomes, pardon the pun, baked into daily restaurant operations and more companies come to market with solutions aimed at national brands and their franchisees. Olo, whom Absher references during our talk, is another such company looking to help restaurants drive more delivery orders through their own in-house ecosystems and maintain more brand integrity in the process.

Absher can’t yet name these larger brands ShiftPixy is currently in talks with, though Denny’s and Carl’s Junior come up in conversation. He also says the company is “getting a lot of viral introductions” as franchisees jump onboard and encourage other nearby franchisees from the same brand to do likewise.

“When you talk to the operators, that’s where it really gets interesting,” he says. “There are a lot of mixed opinions about third party [delivery]. It’s a very confusing landscape. It looks to me like we’re entering the market at the right time in the midst of confusion. We’re hopefully being a source of help and clarity.”