Tag: shake shack

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ConverseNow expands its drive-thru ordering tech as it bags another $10M

Some fast-food drive-thru experiences were immortalized by Joe Pesci in “Lethal Weapon 2” (expletives and all) when he basically said you never get a correct order. Fast-forward to today, and the technology is still a bit lacking, and any number of situations, from people talking in the background to a noisy engine, can inhibit the order-taker from hearing and relaying your order accurately.

Here’s where voice technology startup ConverseNow comes in. The four-year-old startup is tapping into voice artificial intelligence technology to put virtual assistants inside quick-serve restaurants to automate the order-taking process and free up staff to focus on fulfillment and in-person customer service.

“The voice AI space is new and still being explored,” Vinay Shukla, co-founder and CEO of ConverseNow, told TechCrunch. “Similar to online ordering, this technology took a few years to emerge and some have become leaders and some have become followers.”

He referenced companies like ordering tool startups Bbot, which is being acquired by DoorDash, and Lunchbox, which raised $50 million earlier this year, as those that are leading the space.

However, he explained that a problem has always existed in drive-thrus, but the technology has “never existed to solve the problem and is still not there 100%.” Even as the company applies its own voice AI technology, it is evolving, Shukla added.

ConverseNow is targeting restaurant drive-thrus with new $15M round

“The applications of AI into different verticals are still new,” he said. “Food ordering becomes even more nuanced and drive-thru is complex. Even the best AI platforms may still need human help. What happens when there are birds chirping, kids screaming and engine noise? This is still a new space and market that companies like us created.”

We first profiled ConverseNow last year when it raised $15 million in Series A funding in a round led by Craft Ventures. The company is now back with an additional $10 million in what Shukla is calling a Series A1 round.

The new investment is in partnership with Enlightened Hospitality Investments, the growth equity fund co-founded by Danny Meyer, the founder of Union Square Hospitality Group and Shake Shack. This is EHI’s third investment this year, according to Crunchbase data. This includes vision AI for food waste company PreciTaste, labor management startup 7shifts, and real estate tech company Withco.

As part of the investment, Meyer will join ConverseNow’s board of directors. The new funding gives ConverseNow total funding of $28.8 million since the company was founded in 2018.

In 2021, ConverseNow was live in over 750 stores, with Domino’s Pizza being its flagship restaurant brand. Today, that has grown to over 1,100 restaurants across 40 states and the addition of Fazoli’s and Blake’s Lotaburger. Shukla said that by the end of the year there will be 14 restaurant brands.

The company also experienced 12x revenue growth over the past 12 months and is helping its restaurant customers boost same-store sales up to 30%, increase average tickets up to 20% and provide up to 12 hours of additional labor per store each week.

The “bridge” funding, if you will, gives the company some runway to keep up with demand without the need to raise a Series B just yet, Shukla said. His team has doubled in size since the Series A round, and he expects to continue those hiring efforts in engineering and product.

ConverseNow intentionally started with phones, but the new funding also enables it to accelerate its drive-thru technology and implement it with large and midsized brands, which he describes as having between 200 and 500 stores. It began drive-thru installations earlier this year after a pilot with Fazoli’s.

Next up, the company is exploring additional channels for its AI and data, for example, at the intersection of mobile app ordering and bringing AI personalization in-store for guest experience. This is something it is already working with Fazoli’s on.

“We don’t see the fast food space affected much by the economy because it is the cheapest and fastest food available,” Shukla said. “For us, we are seeing a tremendous growth opportunity because the big guys, like DoorDash, haven’t gotten into this space because they would have to make a call center or partner with someone like us to get data.”

Ghost kitchens ride into college campuses on the backs of delivery bots

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Product Managers Prepare To Go To Battle Over Fried Chicken

Product managers have to provide their customers with what they want
Product managers have to provide their customers with what they want
Image Credit: Thomas Hawk

You would think that being a burger product manager would be a fairly simple job: you get the burger, you make the burger, you sell the burger. However, once upon a time it might have been that simple; however, these days it has become much more complicated. If you can ignore for a moment the fact that you are facing a great deal of competition, it now turns out that your customer’s tastes are changing. Burger product managers have a challenge on their hands and they are going to have to get creative and change their product development definition.

Turns Out That It’s All About Chicken

Product managers at least 10 major U.S. fast-food chains have introduced fried-chicken sandwiches in the past three months, or are set to shortly. Many of those product managers who are peddling the new poultry items work at companies better known as hamburger chains, including McDonald’s, Shake Shack and Jack in the Box. Restaurant operators who have been grappling with slowdowns and restrictions brought on by the Covid-19 pandemic, aim to try to capture consumers’ enthusiasm for crispy, breaded-chicken sandwiches. Once upon a time that fervor helped build Chick-fil-A into one of the nation’s top fast-food chains over the past decade, and made Popeyes Louisiana Kitchen offering a social-media sensation after its 2019 debut. Successes like this would look good on anyone’s product manager resume.

The chicken-sandwich war, as product managers describe it, means diners have lots of options – such as a Korean-style iteration at Shake Shack, a McDonald’s version topped with spicy pepper sauce and a new KFC offering that the chain bills as its “best chicken sandwich ever.” The sandwich craze also might bring lasting changes to the restaurant business, with product managers spending thousands of dollars on new equipment for battering chicken filets to compete for what some franchisees say is the future of eating out.

Burgers are the still top sellers at fast-food restaurants…but breaded-chicken sandwiches have been gaining ground. As an example of this, Shake Shack began selling its new fried-chicken sandwich in the burger chain’s South Korean restaurants during the fall, before it made its debut in the U.S. One of the first limited-time items it put on menus during the pandemic was a spicy chicken sandwich. Stake Shack product managers just want to sell more chicken. Customers are always going to love burgers and chicken, and they want to be known for both. Fast-food restaurants remain bastions of beef, with Big Macs, Whoppers and other burgers outselling breaded-chicken sandwiches by roughly 3-to-1.

What Comes Next?

Hailing the new chicken competition are poultry executives, who face pandemic-constrained dining and surging grain prices. Chicken sandwiches tend to be more profitable than beef ones sold in chain restaurants, as they draw on a cheaper commodity. Chicken sandwiches typically cost less on menus than big burgers, a possible draw for budget-conscious consumers during the pandemic.

Restaurant chains and franchisees are currently investing heavily in the battle. KFC said it worked with six bakeries in order to find a bun able to handle its quarter-pound white-meat filet that will make its nationwide debut in February, a chicken patty about 20% larger than its existing crispy option. Church’s Chicken owners spent about $3,000 per restaurant to buy equipment to make the chain’s new chicken sandwich, while Burger King owners are buying battering stations to install in kitchens as they test a hand-breaded chicken sandwich.

At McDonald’s, which hasn’t had a Southern-style battered-chicken sandwich on its U.S. menus nationwide for years, product managers at franchisees have been pushing for one. They know that they can’t afford to be last in a category that clearly is the future of fast food. Responding to customer demand, McDonald’s product managers said they would begin selling a Crispy Chicken Sandwich with crinkle-cut pickles on a buttered potato bun, while adding two other chicken sandwiches to the permanent menu. McDonald’s product managers told franchisees during an internal meeting that a successful crispy-chicken-sandwich launch was a priority. Product managers said they were studying how to introduce more chicken at breakfast, an option long sought by franchisees in the South.


What All Of This Means For You

The world of burger product managers is currently undergoing a significant transformation. What used to be a pretty straightforward job has all of sudden become much more complicated. It turns out that what customers really want these days is chicken. Burger product managers are having to study their product manager job description and scramble to find ways to meet the new need. Most of the major fast food chains are in the process of introducing new chicken sandwiches. Some chains have built their entire business on the success of their chicken offerings. Offering chicken sandwiches can provide customers with more options. However, when a chain starts to offer chicken sandwiches, they have to make investments in order to serve the new chicken products. Product managers believe that customers will always buy both burgers and chicken. They just want to meet all of their customer’s needs. Chicken sandwiches generally cost less than burgers. In order to start offering chicken, restaurant chains are investing heavily in order to prepare and serve the chicken. Even McDonalds is preparing to introduce a new chicken sandwich. Clearly the world has changed. Customers who visit burger joints are no longer going to be satisfied with just being offered burgers – now they want chicken. Burger product managers are in the process of trying to determine how they can shift to providing this new type of product. Since it looks like just about everyone is trying to do this, we’ll have to keep our eyes open and discover who ends up doing it the best.

– Dr. Jim Anderson Blue Elephant Consulting –
Your Source For Real World Product Management Skills™


Question For You: Do you think that burger chains should stop selling burgers and focus on chicken?


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What We’ll Be Talking About Next Time

You would think that if you were a product manager at one of the world’s largest retail companies, getting into a new line of business would not be all that hard to do. I mean your company has deep pockets and can probably spend a lot of money to do whatever everyone else in this new market is doing. The result isn’t if you are going to be successful, it’s really more a question of just how successful you are going to be. As Walmart has gotten into the home grocery delivery business, their product managers have discovered that even being big may not be enough to ensure that they will be a success.

The post Product Managers Prepare To Go To Battle Over Fried Chicken appeared first on The Accidental Product Manager.

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Why focusing on holistic care helped Kindbody triple its revenue in 2021

One story from The Verge referred to Kindbody as the “SoulCycle” of fertility, pointing out that it sells fertility services and “empowerment” to 25-year-olds. It’s kind of a stretch, but I can see how the company could be compared to the aesthetic-driven facade of The Wing.

Kindbody isn’t solely selling a dream of belonging, however — there is a large focus on the consumerism of patient care. By concentrating on helping its patients feel like they have agency over their fertility journeys, Kindbody is trying to fit into the lives of those wanting to get pregnant.

“When you build businesses you have to think about how consumers behave today and what’s changed in the last five years or 10 years or 15 years,” Kindbody founder and chairwoman Gina Bartasi said. “And consumers crave and receive content.”

She recognizes how different the space is now compared to when she went through her own fertility journey.

“I think the hardest part is adapting, whether it’s adapting the media or adapting to healthcare,” she said. “You constantly have to have this circle and loop back with your customer and customer behavior and how that’s changed. And in healthcare, of course, your customer is the patient.”

Over the last decade, our lives have changed exponentially due to the easy access to information via social media platforms, and the COVID-19 pandemic only added a feeling of perpetual uncertainty. Businesses shut down for months at the top of 2020, schools have oscillated between mandating physical attendance and holding virtual classes nationwide, and offices that once forbade remote work have been introduced to hybrid setups like “hoteling.”

“The majority of patients need flexibility in their calendars,” Bartasi said. “I think, historically speaking, in health care, the patient did whatever the doctor did, whatever the doctor told them to do, and at Kindbody the patient is in charge, not necessarily the doctor.”

You can see this approach in nearly all of Kindbody’s services. Not only does Kindbody want to cater to how its potential patients carry on their lives, it wants them to have a familiar experience as well. Open Kindbody’s website, and you’ll find a templatized, user-friendly landing page with photos of well-designed offices and links to its social media. It’s a familiar look for the 2020s at this point, and that’s intentional.

At the end of the day, you can have the best technology and the best data, but [patients] are still at home crying; it sucks and [they] can’t get out of bed in the morning. Barbara Collura, president of Resolve

With both B2B and B2C income streams, this company is trying to significantly disrupt the women’s healthcare space by focusing on educating, helping patients feel cared for and offering solutions to major pain points through employer-provided benefits.

As Bartasi mentioned in part 1 of this TC-1, she felt like she was treated as the subordinate to the doctor throughout her fertility journey, and her team at Kindbody has put in a lot of work to avoid that.

“It’s really a broken system”

Thanks to the nature of their relationships with the space, both Bartasi and Dr. Fahimeh Sasan, Kindbody’s current chief innovation officer and an experienced board-certified OBGYN, are familiar with the challenges of the fertility journey from two different perspectives — the patient and the provider. They found that the overarching challenge, which ultimately makes every step of this process more difficult, is the fragmentation of care.

Dr. Fahimeh Sasan, Kindbody’s current chief innovation officer

Dr. Fahimeh Sasan, Kindbody’s chief innovation officer. Image Credits: Kindbody

“It’s really a broken system, and it’s a system that in no way, shape or form is based on proven human health nor on being proactive,” said Dr. Sasan. “It’s a 100% reactionary system. I was taught that you wait for a woman to prove that she’s not fertile and she has to prove her infertility diagnosis before you start doing testing and see if that’s what the problem may be.”

This reactionary approach is something she’s always felt needed to be corrected. She offers examples of how other ailments or potential health problems are addressed with the aim to prevent rather than cure.

“You do stress tests so that someone doesn’t have a heart attack. We do mammograms to detect breast changes before someone has breast cancer.” But when it comes to infertility, patients have to prove they are experiencing it before it can be addressed. She believes that the teaching and, subsequently, the care, have not caught up with the technology available for patients.

“If you think about the advancements that have been in this field, whether it’s the first egg-freezing or hormone-testing, like for the Anti-Müllerian hormone, and even the capabilities of ultrasound and sonogram, the teachings haven’t changed.”

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NotCo gets its horn following $235M round to expand plant-based food products

NotCo, a food technology company making plant-based milk and meat replacements, wrapped up another funding round this year, a $235 million Series D round that gives it a $1.5 billion valuation.

Tiger Global led the round and was joined by new investors, including DFJ Growth Fund, the social impact foundation, ZOMA Lab; athletes Lewis Hamilton and Roger Federer; and musician and DJ Questlove. Follow-on investors included Bezos Expeditions, Enlightened Hospitality Investments, Future Positive, L Catterton and Kaszek Ventures.

This funding round follows an undisclosed investment in June from Shake Shack founder Danny Meyer through his firm EHI. In total, NotCo, with roots in both Chile and New York, has raised more than $350 million, founder and CEO Matias Muchnick told TechCrunch.

Currently, the company has four product lines: NotMilk, NotBurger and NotMeat, NoticeCream and NotMayo, which are available in the five countries of the U.S., Brazil, Argentina, Chile and Colombia.

The company is operating in the middle of a trend toward eating healthier food, as more consumers also question how their food is made, resulting in demand for alternative proteins. In fact, the market for alternative meat, eggs, dairy and seafood products is predicted to reach $290 billion by 2035, according to research by Boston Consulting Group and Blue Horizon Corp.

NotCo’s proprietary artificial intelligence technology, Giuseppe, matches animal proteins to their ideal replacements among thousands of plant-based ingredients. It is working to crack the code in understanding the molecular components and food characteristics in the combination of two ingredients that could mimic milk, but in a more sustainable and resourceful way — and that also tastes good, which is the biggest barrier to adoption, Muchnick said.

“Our theory is that there is a crazy dynamic among people: 60% who are already eating plant-based are not happy with the taste, and 30% of those who drink cow’s milk are waiting to change if there is a similar taste,” he added. “Our technology is based in AI so that we can create a different food system, as well as products faster and better than others in the space. There are 300,000 plant species, and we still have no idea what 99% of them can do.”

In addition to a flow of investments this year, the company launched its NotMilk brand in the United States seven months ago and is on track to be in 8,000 locations across retailers like Whole Foods Market, Sprouts and Wegmans by the end of 2021.

Muchnick plans to allocate some of the new funding to establish markets in Mexico and Canada and add market share in the U.S. and Chile. He expects to have 50% of its business coming from the U.S. over the next three years. He is also eyeing an expansion into Asia and Europe in the next year.

NotCo also intends to add more products, like chicken and other white meats and seafood, and to invest in technology and R&D. He expects to do that by doubling the company’s current headcount of 100 in the next two years. Muchnick also wants to establish more patents in food science — the company already has five — and to explore a potential intelligence side of the business.

Though NotCo reached unicorn status, Muchnick said the real prize is the brand awareness and subsequent sales boost, as well as opening doors for quick-service restaurant deals. NotBurger went into Burger King restaurants in Chile 11 months ago, and now has 5% of the market there, he added.

Sales overall have grown three times annually over the past four years, something Muchnick said was attractive to Tiger Global. He is equally happy to work with Tiger, especially as the company prepares to go public in the next two or three years. He said Tiger’s expertise will get NotCo there in a more prepared manner.

“NotCo has created world class plant-based food products that are rapidly gaining market share,” said Scott Shleifer, partner at Tiger Global, in a written statement. “We are excited to partner with Matias and his team. We expect continued product innovation and expansion into new geographies and food categories will fuel high and sustainable growth for years to come.”

4 sustainable industries where founders and VCs can see green by going green

 

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My experience with the CARES Act was frustrating, confusing and unfair

Suzanne Borders Contributor
Suzanne is the CEO and co-founder of BadVR. She thrives at the intersection of data, art, technology and poetry.

As a small business owner, I was excited to learn about the $2.2 trillion Coronavirus Aid, Relief, and Economic Security Act that offers low-interest loans to firms impacted by the COVID-19 pandemic. However, as I read through the details and began to apply, it became clear that this legislation — while well-intentioned — may not be enough to help many SMBs and startups.

Here’s a quick recap of my experience.

Emergency Economic Injury Grants and Economic Injury Disaster Loans

First and foremost: You need to act swiftly. Emergency Economic Injury Grant and Economic Injury Disaster Loan programs included in the CARES Act function on a first-come, first-served basis, and are funded from a limited pool of resources.

I began my company’s application process by submitting our EIDL and EEIG applications through the SBA website. This was easy, if tedious. It took about two hours to complete the necessary online forms and about two seconds to click the EEIG checkbox. Submission was seamless, but I haven’t received any further communication from the SBA since completing my application, which is a bit confusing — EEIG funds are supposed to be dispersed within 3-5 days of the submission date.

However, I know there’s been a huge volume of submissions recently and this must be exceptionally difficult to handle. I look forward to any email correspondence or updates from the SBA that might give me — and other applicants — an updated estimate of the expected dispersal timeline.

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The next big restaurant chain may not own any kitchens

If investors at some of the biggest technology companies are right, the next big restaurant chain could have no kitchens of its own.

These venture capitalists think the same forces that have transformed transportation, media, retail and logistics will also work their way through prepared food businesses.

The Battle Is For The Customer Interface

Investors are pouring millions into the creation of a network of shared kitchens, storage facilities, and pickup counters that established chains and new food entrepreneurs can access to cut down on overhead and quickly spin up new concepts in fast food and casual dining.

Powering all of this is a food delivery market that could grow from $35 billion to a $365 billion industry by 2030, according to a report from UBS’s research group, the “Evidence Lab”.

“We’ve had conversations with the biggest and fastest growing restaurant brands in the country and even some of the casual brands,” said Jim Collins, a serial entrepreneur, restauranteur, and the chief executive of the food-service startup, Kitchen United. “In every board room for every major restaurant brand in the country… the number one conversation surrounds the topic of how are we going to address [off-premise diners].”

Collins’ company just raised $10 million in a funding round led by GV, the investment arm of Google parent company, Alphabet. But Alphabet’s investment team is far from the only group investing in the restaurant infrastructure as a service business.

Perhaps the best capitalized company focusing on distributed kitchens is CloudKitchens, one of two subsidiaries owned by the holding company City Storage Solutions.

Cloud Kitchens and its sister company Cloud Retail are the two arms of the new venture from Uber co-founder and former chief executive, Travis Kalanick, which was formed with a $150 million investment.

Travis Kalanick is already back running a company with a $150M investment

As we reported at the time, Travis announced that he would be starting a new fund with the riches he made from Uber shares sold in its most recent major secondary round. Kalanick said his 10100, or “ten one hundred”, fund would be geared toward “large-scale job creation,” with investments in real estate, e-commerce, and “emerging innovation in India and China.”

If anyone is aware of the massive market potential for leveraging on-demand services, it’s Kalanick. Especially since he was one of the architects of the infrastructure that has made it possible.

Other deep pocketed companies have also stepped into the fray. Late last year Acre Venture Partners, the investment arm formed by The Campbell Soup Co., participated in a $13 million investment for Pilotworks, another distributed kitchen operator based in Brooklyn.

Meanwhile, Kitchen United has been busy putting together a deep bench of executive talent culled from some of the largest and most successful American fast food restaurant chains.

Former Taco Bell Chief Development Officer, Meredith Sandland, joined the company earlier this year as its chief operating officer, while former McDonald’s executive Atul Sood, who oversaw the burger giant’s relationship with online delivery services, has come aboard as Kitchen United’s Chief Business Officer.

The millions of dollars spicing up this new business model investors are serving up could be considered the second iteration of a food startup wave.

Food startup Maple shuts down operations in New York to join Deliveroo

An earlier generation of prepared food startups crashed and burned while trying to spin up just this type of vision with investments in their own infrastructure. New York celebrity chef David Chang, the owner and creator of the city’s famous Momofuku restaurants (and Milk Bar, and Ma Peche), was an investor in Maple, a new delivery-only food startup that raised $25 million before it was shut down and its technology was absorbed into the European, delivery service, Deliveroo.

Ando, which Chang founded, was another attempt at creating a business with a single storefront for takeout and a massive reliance on delivery services to do the heavy lifting of entering new neighborhoods and markets. That company wound up getting acquired by UberEats after raising $7 million in venture funding.

Uber Eats acquires Ando, the food delivery startup from David Chang that makes its own food

Those losses are slight compared to the woes of investors in companies like Munchery, ($125.4 million) Sprig, ($56.7 million) and SpoonRocket ($13 million). Sprig and Spoonrocket are now defunct, and Munchery had to pull back from markets in Los Angeles, New York, and Seattle as it fights for survival. The company also reportedly was looking at recapitalizing earlier in the year at a greatly reduced valuation.

On-demand food startup Sprig is shutting down today

What gives companies like Kitchen United, Pilotworks and Cloud Kitchens hope is that they’re not required to actually create the next big successful concept in fast food or casual dining. They just have to enable it.

Kitchen United just opened a 12,000 square foot facility in Pasadena for just that purpose — and has plans to open more locations in West Los Angeles; Jersey City, N.J.; Atlanta; Columbus, Ohio; Phoenix; Seattle and Denver. Its competitor, Pilotworks, already has operations in Brooklyn, Chicago, Dallas, and Providence, R.I.

While the two companies have similar visions, they’re currently pursuing different initial customers. Pilotworks has pitched itself as a recipe for success for new food entrepreneurs. Kitchen United, by comparison is giving successful local, regional, and national brands a way to expand their footprint without investing in real estate.

“One of the directions that the company was thinking of going was toward the restaurant industry and the second was in the food service entrepreneurial sector,” said Collins. “Would it be a company that served restaurants with their expansions? Now, we’re in deep discussions with all kinds of restaurants.”

Smaller national fast food chains like Chick-Fil-A or Shake Shack, or fast casual chains like Dennys and Shoney’s could be customers, said Collins. So could local companies that are trying to expand their regional footprint. Los Angeles’ famous Canter’s Deli is a Kitchen United customer (and an early adopter of a number of new restaurant innovations) and so is The Lost Cuban Kitchen, an Iowa-based Cuban restaurant that’s expanding to Los Angeles.

Canters restaurant royalty raises $9.5 million for Ordermark, a takeout order management service

Kitchen United is looking to create kitchen centers that can house between 10-20 restaurants in converted warehouses, big box retail and light industrial locations.

Using demographic data and “demand mapping” for specific cuisines, Kitchen United said that it can provide optimal locations and site the right restaurant to meet consumer demand. The company is also pitching labor management, menu management and delivery tools to help streamline the process of getting a new location up and running.

“In all of the facilities, all of the restaurants have their own four-walled space,” says Collins. “There’s shared infrastructure outside of that.”

Some of that infrastructure is taking food deliveries and an ability to serve as a central hub for local supplier, according to Collins. “One of the things that we’re going to be launching relatively soon here in Pasadena, is actually in-service days where local supplier and purveyors can come in and meet with seven restaurants at once.”

It’s also possible that restaurants in the Kitchen United spaces could take advantage of restaurant technologies being developed by one of the startup’s sister companies through Cali Group, a holding company for a number of different e-sports, retail, and food technology startups.

The Pasadena-based kitchen company was founded by Harry Tsao, an investor in food technology (and a part owner of the Golden State Warriors and the Los Angeles Football Club) through his fund Avista Investments; and John Miller, a serial entrepreneur who founded the Cali Group.

In fact, Kitchen United operates as a Cali Group portfolio company alongside Miso Robotics, the developer of the burger flipping robot, Flippy; Caliburger, an In-n-Out clone first developed by Miller in Shanghai and brought back to the U.S.; and FunWall, a display technology for online gaming in retail settings.

Flippy, the robot hamburger chef, goes to work

“Kitchen United’s data-driven approach to flexible kitchen spaces unlocks critical value for national, regional, and local restaurant chains looking to expand into new markets,” said Adam Ghobarah, general partner at GV, and a new director on the Kitchen United board. “The founding team’s experience in scaling — in addition to diverse exposure to national chains, regional brands, regional franchises, and small upstart eateries — puts Kitchen United in a strong position to accelerate food innovation.”

GV’s Ghobarah actually sees the investment of a piece with other bets that Alphabet’s venture capital arm has made around the food industry.

The firm is a backer of the fully automated hamburger preparation company, Creator, which has raised roughly $28 million to develop its hamburger making robot (if Securities and Exchange Commission filings can be believed). And it has backed the containerized farming startup, Bowery Farming, with a $20 million investment.

Taste test: Burger robot startup Creator opens first restaurant

Ghobarah sees an entirely new food distribution ecosystem built up around facilities where Bowery’s farms are colocated with Kitchen United’s restaurants to reduce logistical hurdles and create new hubs.

“As urban farming like Bowery scales up… that becomes more and more realistic,” Ghobarah said. “The other thing that really stands out when you have flexible locations … all of the thousands of people who want to own a restaurant now have access. It’s not really all regional chains and national chains… With a satellite location like this… [a restaurant]… can break even at one third of the order volume.”

 

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Can Product Managers Find A Way To Make A Better Burger?

Shake Shack burgers are good, but could they be even better?

Shake Shack burgers are good, but could they be even better?
Image Credit: Lucas Richarz

I’m pretty sure that we’ve all had that feeling: it’s the “I want a burger” feeling. I’m not sure if I can really describe what it is, but there is a sudden need that we have to be filling our mouths with the rich satisfying feeling of consuming a big burger. The folks over at Shake Shack realized that we were all feeling this way. They also realized that the slimed down “always the same” burgers that we can get from McDonalds and Burger King just weren’t doing it for us. That’s why they created their signature burgers and were able to successful charge more for them. However, times are changing and Shake Shack needs their product managers to change their product development definition and help to find ways to keep growing.

The Shake Shack Problem

As product managers, we always seem to have a lot of problems that we have to find solutions to. What this means is that if we don’t have a problem, we probably should not be spending any time trying to fix it. However, over at the Shake Shack, their product managers are getting all of the signs that they really do have a problem on their hands. When Shake Shack first showed up, investors couldn’t get enough of it. Things have changed. Their same-store sales have recently fallen by 2.5% and they have had to revise their annual comparable sales outlook downward. Their stock started out at US$22 / share and soared up. However, it has taken a tumble of more than 60% and was recently trading at $34.88 / share. That’s not going to look good on anyone’s product manager resume.

One of the things that makes working at Shake Shack unique from a product manager’s point of view is that everyone who goes to work for Shake Shack, no matter what your job is, is required to spend a portion of the time in an actual store working at the different stations. They do this so that they understand what is required in order to be able to make fries, burgers, and milkshakes. It has never been easy to run a restaurant and right now things are only getting tougher. All restaurants are currently experiencing the double whammy of decreasing foot traffic coupled with rising labor costs.

Shake Shack product managers have a real challenge on their hands. Even as their U.S. stores are struggling to grow, the company has plans to expand internationally. There are currently 84 stores in the U.S. There are also 12 stores in countries that include Japan, Russia, and the United Arab Emirates. The product managers are going to have to be able to find ways to protect the company’s unique start-up image while still allowing the company to grow larger.

How To Fix What’s Wrong At the Shake Shack

So Shake Shack has some problems. It sure sounds like this is exactly the kind of thing that product managers are supposed to solve. What can they do in this case? The good news here is that there are a number of other restaurants that have been facing the same types of problems. Shake Shack can learn from how they have gone about tackling this kind of problem. One of the first steps that the product managers have taken to get more people to visit their stores has been to release a mobile application. The goal of this application, as with other restaurants, is to provide their customers with a way to skip the lines in the store.

The introduction of the mobile application is a great first start. However, going forward, the Shake Shack product managers are going to have to find other ways to use technology to improve how the company operates. This means taking a look at how the company does things today and searching for better ways to do them using technology. What the product managers are going to have to take a look at is how the company is currently performing their inventory, ordering, and other internal processes in order to find ways to improve them.

Even as the product managers start to make these changes, they need to be aware that there will be things that they can’t change. The Shake Shack brand identity has to be preserved. Shake Shack currently has a great deal of brand value. One of the things that sets Shake Shack apart from its rivals is that it still has the feel of a startup. The product managers are going to have to spend their time looking for processes that they can centralize and perhaps bring back to the company’s headquarters.

What All Of This Means For You

There are very few industries that are as competitive as the restaurant industry is. Shake Shack has identified our love of burgers and they have created burger products that allow them to stand out from other burger chains such as McDonalds and Burger King. However, recently their sales and stock price have both started to decline. It’s going to be up to the Shake Shack product managers to find a way to turn things around.

Shake Shack has worked to make sure that all of its employees really understand how the business works. What this means is that all employees are required to work in a Shake Shack store as a part of their initial training. All of their stores are currently dealing with fewer customers and rising costs. In order to solve the problems that the firm is facing, the product managers have introduced a new mobile application in order to reduce in-store waiting. The product managers are also looking at other systems used by the store in order to find ways that they can improve how the stores operate. Although changes will be required, the product managers have to be careful that they don’t change the value of the Shake Shack brand.

Shake Shack has done a very good job of providing a novel and desired product in a crowded market. As the firm matures and grows, they now need to deal with the challenges of no longer being a new firm. The Shake Shack product managers are going to have to study their product manager job description and determine how to apply technology in a way that will boost sales while not harming the Shake Shack brand.

– Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World Product Management Skills™

Question For You: Do you think that the Shake Shack product managers should make changes to the foods that the restaurant offers?

Click here to get automatic updates when
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P.S.: Free subscriptions to The Accidental Product Manager Newsletter are now available. It’s your product – it’s your career. Subscribe now: Click Here!

What We’ll Be Talking About Next Time

So just in case you didn’t realize it, Apple makes a lot of money from both renting and selling movies. This is all part of their iTunes empire that has been around for a while and has become sort of the defecto go-to location for a lot of people when they are looking for new music or movies. However, things are starting to change for the Apple product managers. Their share of the video rental / sales market has started to slip because of changing customer needs and new competitors. What’s a product manager to do?

The post Can Product Managers Find A Way To Make A Better Burger? appeared first on The Accidental Product Manager.

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What Can Product Managers Do When Burgers Cost Too Much?

How much would you be willing to pay for a burger?

How much would you be willing to pay for a burger?
Image Credit: Jonathan Harford

Think about it for just a moment: just exactly what goes into making a good hamburger? We’re basically talking about three sets of ingredients: a burger (of course), a bun, and a collection of toppings. Just exactly how much should any of that cost? One upon a time you could go out to a restaurant and get a burger fairly cheaply. However, in the past few years a number of restaurants who all claim to be serving a “better burger” have popped up. Their burger is pretty much what any of us have expected, but they use artisan buns and a collection of nontraditional toppings. Along with making the plain burger fancier, have they also made a burger cost too much?

The Problem With A “Better Burger”

Just exactly when are people eating these fancy burgers? The product managers who study such things tell us that lunch is the most popular meal for burgers. This poses a bit of a problem. Lunch time traffic to quick-serve restaurants who serve burgers fell by 5% last year. The reason that this is interesting is because it’s the biggest decline in lunch time traffic that has occurred since this type of traffic has been measured. Is it time for the burger product managers to change their product development definition?

The “better burger” places are pricing their creations at around US$13 for a burger. What product managers are starting to discover is that this price point might not be sustainable. It might be too much to expect people to show up over and over again and spend $13 to get a burger. The average check for a lunch burger has risen by 22% since 2007. The cost of this meal went up by $5.83 last year alone.

The market for burger eaters has always been intense. Over at Wendy’s they are now offering four meals that include burgers which are priced at $4.00. The higher prices for eat-out burgers may be driving more and more customers to start to create their own burgers at home instead of making the trip to the store. Clearly customers have a number of different options when they decide to have a burger. Once upon a time customers only had a few choices when it came to burgers: McDonalds, Burger King, or a local sit-down restaurant. However, now they have a lot of different options and they have a lot of different price points.

How Product Managers Are Going To Fix The Burger Problem

First off we need to understand just how large the burger market is. Back in the early 2000’s a host of new burger joints started showing up: Shake Shack, Smashburger Master, BurgerFi International. These quick-serve restaurants specialized in making bigger burgers that came with specialized ingredients. The number of burger restaurants went through the roof almost quadrupling since 2005. There are now over 2,700 burger restaurants in the U.S. The reason that there are so many of these restaurants is because the fast food / fast-casual burger market is valued at $82B per year. Competing in this market would be something that would look good on anyone’s product manager resume.

In a highly competitive market like this, product managers have been forced to come up with ways to make their burger stand out from the rest of the pack. They have gotten very creative: they’ve used high quality beef for the burgers and fancy toppings which have all contributed to the cost of the burger increasing. As the cost of paying workers has been climbing, the cost of eating out has been climbing even as the cost of eating at home has been dropping. This is a key reason why the high-end burger chains have been seeing less foot traffic.

In order to keep their profits high, the product managers have had to start to get creative in what they offer to their customers. What they have discovered is that if they boost the quality and quantity of the toppings that they offer to their customers, they can boost the average diner’s check by 10%. Premium offerings such as guacamole and fried eggs are part of this. They have expanded the ingredients that customers can put on their burgers to now include chili, bacon, and Portabella mushrooms. The result of this has been that traditional burger restaurants such as McDonalds and Burger King are no longer trying to compete with the high-end burger joints and instead have started to focus on the low end of the market.

What All Of This Means For You

You would think that the burger market would be a calm market with very little competition – I mean, a burger is a burger, right? It turns out that that thinking is incorrect. In the past few years a number of new entrants into the burger restaurant market have introduced a new form of the hamburger: a premium burger with high end ingredients. As expected, the cost of these burgers has also increased and now the big question is just exactly how much are people going to be willing to pay for a high-end burger?

The product managers at this new breed of burger joints are facing a significant problem that their product manager job description doesn’t tell them how to solve: foot traffic in the restaurants has fallen by 5% last year. What seems to be happening is that people are starting to push back against the high prices that are being charged for the new gourmet burgers. The traditional burger restaurants have started to offer bargain burgers in order to retain their core group of customers. The overall burger market is still huge coming in at $85B per year. The tactic that product managers are taking in order keep customers coming in is to offer them more and more fancy toppings including guacamole and fried eggs.

The high-end burger product managers have discovered a new market: people really do like their burgers and they are willing to pay more for a premium burger. However, there also appears to be a limit to just how much people are going to be willing to pay for a burger. Creating new toppings that may not always be available to their customers is a great way to distinguish their product from the competition and keep customers coming back in. Now we’ll just have to see if people are going to be willing to keep paying top dollar for the toppings that they can’t get anywhere else.

– Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World Product Management Skills™

Question For You:

Click here to get automatic updates when
The Accidental Product Manager Blog is updated.

P.S.: Free subscriptions to The Accidental Product Manager Newsletter are now available. It’s your product – it’s your career. Subscribe now: Click Here!

What We’ll Be Talking About Next Time

There are many different types of product manager jobs. One of the more, shall we say delicate of these jobs, is that of being a product manager for a major tobacco company. It is your job to get people to consume more of your product – that means smoke more. It turns out that you currently have real problem on your hands, those young millennial kids are not smoking enough of what you are making.

The post What Can Product Managers Do When Burgers Cost Too Much? appeared first on The Accidental Product Manager.

Posted on

What Can Product Managers Do When Burgers Cost Too Much?

How much would you be willing to pay for a burger?

How much would you be willing to pay for a burger?
Image Credit: Jonathan Harford

Think about it for just a moment: just exactly what goes into making a good hamburger? We’re basically talking about three sets of ingredients: a burger (of course), a bun, and a collection of toppings. Just exactly how much should any of that cost? One upon a time you could go out to a restaurant and get a burger fairly cheaply. However, in the past few years a number of restaurants who all claim to be serving a “better burger” have popped up. Their burger is pretty much what any of us have expected, but they use artisan buns and a collection of nontraditional toppings. Along with making the plain burger fancier, have they also made a burger cost too much?

The Problem With A “Better Burger”

Just exactly when are people eating these fancy burgers? The product managers who study such things tell us that lunch is the most popular meal for burgers. This poses a bit of a problem. Lunch time traffic to quick-serve restaurants who serve burgers fell by 5% last year. The reason that this is interesting is because it’s the biggest decline in lunch time traffic that has occurred since this type of traffic has been measured. Is it time for the burger product managers to change their product development definition?

The “better burger” places are pricing their creations at around US$13 for a burger. What product managers are starting to discover is that this price point might not be sustainable. It might be too much to expect people to show up over and over again and spend $13 to get a burger. The average check for a lunch burger has risen by 22% since 2007. The cost of this meal went up by $5.83 last year alone.

The market for burger eaters has always been intense. Over at Wendy’s they are now offering four meals that include burgers which are priced at $4.00. The higher prices for eat-out burgers may be driving more and more customers to start to create their own burgers at home instead of making the trip to the store. Clearly customers have a number of different options when they decide to have a burger. Once upon a time customers only had a few choices when it came to burgers: McDonalds, Burger King, or a local sit-down restaurant. However, now they have a lot of different options and they have a lot of different price points.

How Product Managers Are Going To Fix The Burger Problem

First off we need to understand just how large the burger market is. Back in the early 2000’s a host of new burger joints started showing up: Shake Shack, Smashburger Master, BurgerFi International. These quick-serve restaurants specialized in making bigger burgers that came with specialized ingredients. The number of burger restaurants went through the roof almost quadrupling since 2005. There are now over 2,700 burger restaurants in the U.S. The reason that there are so many of these restaurants is because the fast food / fast-casual burger market is valued at $82B per year. Competing in this market would be something that would look good on anyone’s product manager resume.

In a highly competitive market like this, product managers have been forced to come up with ways to make their burger stand out from the rest of the pack. They have gotten very creative: they’ve used high quality beef for the burgers and fancy toppings which have all contributed to the cost of the burger increasing. As the cost of paying workers has been climbing, the cost of eating out has been climbing even as the cost of eating at home has been dropping. This is a key reason why the high-end burger chains have been seeing less foot traffic.

In order to keep their profits high, the product managers have had to start to get creative in what they offer to their customers. What they have discovered is that if they boost the quality and quantity of the toppings that they offer to their customers, they can boost the average diner’s check by 10%. Premium offerings such as guacamole and fried eggs are part of this. They have expanded the ingredients that customers can put on their burgers to now include chili, bacon, and Portabella mushrooms. The result of this has been that traditional burger restaurants such as McDonalds and Burger King are no longer trying to compete with the high-end burger joints and instead have started to focus on the low end of the market.

What All Of This Means For You

You would think that the burger market would be a calm market with very little competition – I mean, a burger is a burger, right? It turns out that that thinking is incorrect. In the past few years a number of new entrants into the burger restaurant market have introduced a new form of the hamburger: a premium burger with high end ingredients. As expected, the cost of these burgers has also increased and now the big question is just exactly how much are people going to be willing to pay for a high-end burger?

The product managers at this new breed of burger joints are facing a significant problem that their product manager job description doesn’t tell them how to solve: foot traffic in the restaurants has fallen by 5% last year. What seems to be happening is that people are starting to push back against the high prices that are being charged for the new gourmet burgers. The traditional burger restaurants have started to offer bargain burgers in order to retain their core group of customers. The overall burger market is still huge coming in at $85B per year. The tactic that product managers are taking in order keep customers coming in is to offer them more and more fancy toppings including guacamole and fried eggs.

The high-end burger product managers have discovered a new market: people really do like their burgers and they are willing to pay more for a premium burger. However, there also appears to be a limit to just how much people are going to be willing to pay for a burger. Creating new toppings that may not always be available to their customers is a great way to distinguish their product from the competition and keep customers coming back in. Now we’ll just have to see if people are going to be willing to keep paying top dollar for the toppings that they can’t get anywhere else.

– Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World Product Management Skills™

Question For You:

Click here to get automatic updates when
The Accidental Product Manager Blog is updated.

P.S.: Free subscriptions to The Accidental Product Manager Newsletter are now available. It’s your product – it’s your career. Subscribe now: Click Here!

What We’ll Be Talking About Next Time

There are many different types of product manager jobs. One of the more, shall we say delicate of these jobs, is that of being a product manager for a major tobacco company. It is your job to get people to consume more of your product – that means smoke more. It turns out that you currently have real problem on your hands, those young millennial kids are not smoking enough of what you are making.

The post What Can Product Managers Do When Burgers Cost Too Much? appeared first on The Accidental Product Manager.

Posted on

Square now lets developers use its Reader to build custom checkout experiences

Square, the company you know from your favorite coffee shop’s checkout counter, is opening to developers its Reader hardware. Using the new Square Reader SDK, developers will be able to build their own custom checkout and point of sale experiences, no matter whether that’s a self-ordering kiosk, a mobile app for waiters or any other similar service.

“While we’ve built some of the best point of sale software on the market, we know that many industries have niche needs and businesses may crave unique experiences that aren’t served by our existing products,” Square’s developer platform lead Carl Perry writes today. “That’s why we’re opening up our platform and providing developers direct access to Square hardware for the very first time.”

The overall idea here, it seems, is to ensure that Square’s service doesn’t just work well in industries where it is already strong (retail, restaurants, etc.) but also in niches where it currently doesn’t have a presence. And this new SDK will allow iOS and Android developers that want to support Square’s payment system to bring their solutions to verticals like transportation and healthcare, for example. It’ll also make it easy for them to integrate their payment system with other business software, like customer relationship management solutions and more complex enterprise resource planning systems.

Among those who have already trialed the SDK is Shake Shack, which is testing a Square Reader SDK-powered self-service kiosk at its “Shack of the Future” in New York and a number of pop-up locations. Similarly, Infinite Peripherals is building a digital taxi meter that’s currently in use in Washington, DC. Other early users include Joe and the Juice, a juice chain with an Instagram account, and  QuiqMeds, which helps healthcare providers dispense medication at the point-of-care (instead of the pharmacy).