Slashdot Mirror
Automation Coming To Restaurants, But Not Because of Minimum Wage Hikes
dcblogs writes: McDonald's this week told financial analysts of its plans to install self-ordering kiosks and mobile ordering at its restaurants. This news prompted the Wall Street Journal to editorialize, in " Minimum Wage Backfire," that while it may be true for McDonald's to say that its tech plans will improve customer experience, the move is also "a convenient way...to justify a reduction in the chain's global workforce." Minimum wage increase advocates, the Journal argued, are speeding along an automation backlash. But banks have long relied on ATMs, and grocery stores, including Walmart, have deployed self-service checkouts. In contrast, McDonald's hasn't changed its basic system of taking orders since its founding in the 1950s, said Darren Tristano, executive vice president of Technomic, a research group focused on the restaurant industry. While mobile, kiosks and table ordering systems may help reduce labor costs, the automated self-serve technology is seen as an essential. It will take the stress out of ordering (lines) at fast food restaurants, and the wait for checks at more casual restaurants. It also helps with upselling and membership to loyalty programs. People who can order a drink refill off a tablet, instead of waving down waitstaff, may be more inclined to do so. Moreover, analysts say younger customers want self-service options.
They turned into a Murdoch rag is what happened.
What you hear in the ear, preach from the rooftop Matthew 10.27b
Or maybe in this instance it's just a better way to serve food.
They have had these machines in Japan for decades. It's basically a ticket vending machine, you choose what you want and pay for it, then hand the tickets to the staff. They prepare and serve your food, without handling dirty money that has been through FSM knows how many hands and pockets. The line for the machine is usually very short too, because you get the ticket immediately and can sit down while waiting for food.
const int one = 65536; (Silvermoon, Texture.cs)
SJW, n: "Someone I don't like, and by the way I'm a fuckwit" - AC
In contrast, McDonald's hasn't changed its basic system of taking orders since its founding in the 1950s
When I was a kid in the 1970s, I remember the order-takers at McDonalds would take the order down on a paper pad, then in seconds add it all up with a pencil and present you with the total.
Wonder if the cashiers would even be able to do that today...
Point of fact: McDonalds as a corporation doesn't sign those peoples' paychecks, at least if their business model hasn't changed since 2000ish. They do franchising, and make money on the fact that franchises have to purchase supplies from the company. This allows them to dodge risk on opening in poor locations, or personnel expenses.
Now, I'm not so thick-headed as to imagine that they wouldn't come up with something like this to help franchises with wage costs, but I'm also aware that this tech is coming to all sorts of places other than Seattle where the minimum wage actually went up.
I live in France and these things are in every McDonalds already. I did not realize that they were not common elsewhere.
Ordering at a self-service kiosk is convenient because few people uses them, so usually there's no queue. This may be related to the fact that they only take cards. Ordering from the kiosk also prevent misunderstandings.
I've also used their mobile app and their website to order (for pick-up, they don't do delivery) but the benefits are minimal compared to ordering from the kiosk. Paying with a card on a mobile phone is annoying, especially when 3D-Secure kicks in and I have to copy the confirmation number from the SMS to the app. I'm sure that for McDonalds the main benefit of the mobile and online offerings is that they lock in the customer and prevents her/him from changing their mind on the way to the restaurant (but not really as you pay only if you collect the meal).
Nobox: Only simple products.
Also... we are talking about the lowest rung of employees. Minimum wage or close. Raise those wages, and what happens to everyone elses wages? They go up. Wages go up, prices go up. Wages won't pay for themselves - those increases WILL be passed on to consumers.
When the minimum wage went up in San Jose, the downtown pizza parlor raised the per-slice price by $0.25 USD and per pie price by $1.00 USD. Business remained steady and the world didn't come to an end. Never mind that states with higher minimum wage have higher job growth.
This will put more people on welfare, food stamps and beholden to the Democratic party.
I'm still waiting for my FREE iPhone from the government that Republicans always talk about but can never provide a link to the sign-up page.
"and kept politics contained in the opinion pages" - To play devil's advocate - this particular article IS in the Opinion section.
retrorocket.o not found, launch anyway?
Democrats are going to keep demanding that the government force low-skilled workers out of work... sorry, increase the minimum wage.
Now that it's been studied, it turns out this isn't the case. Raising the minimum wage doesn't force people out of work, and, in some cases, causes local economies to surge. Seattle is the most recent example.
http://seattletimes.com/html/l...
"Raise those wages, and what happens to everyone elses wages? They go up."
No they don't. Not for regular workers and non-upper management.
The middle class lose ground when the Minimum wage goes up because prices go up to cover lost profits, and their wages don't budge, reducing their effective income.
Point of fact: McDonalds as a corporation doesn't sign those peoples' paychecks, at least if their business model hasn't changed since 2000ish. They do franchising, and make money on the fact that franchises have to purchase supplies from the company. This allows them to dodge risk on opening in poor locations, or personnel expenses.
Actually, this isn't how McDonalds corporate works.
The way McDonalds works is it picks your location for you, buys it, builds a McDonalds there, and guarantees you your franchise buy-in back in one year. The franchise buy-in is $1M, which you get back in one year, and then you make that each year thereafter.
They *do* sell you trade dress items - fry boxes with the 'M' on them, and they sell you food supplies - but their primary profit actually comes from their real estate holdings, the fact that they are your landlord, and franchise fees.
Once they do sell you a franchise, they dictate your trade dress, which means corporate pays for remodeling the individual franchise stores (after all, McDonalds themselves owns the property), and when they tell you remodel, expect the crews to show up and just do it, you are at best granted minor choices on things like arrangement of the bathrooms, and the manager's office, and so on. Otherwise, they dictate. This is a typically good thing, since they know how many people will go through in a given amount of time, max, because they have a PhD in mathematics who understands queuing theory work it out.
In addition, you can't buy a franchise unless you have been a store manager, and you can't be a store manager unless you've been an assistant manager, and you can't be an assistant manager unless you've been a shift lead, and you can't be a shift lead unless you've been an ordinary employee. In other words, every step in responsibility requires that you be able to do all the jobs at the previous step in responsibility. This is why when they have walkouts, they typically don't close down over them.
So it's not like this will change the need for employees, from the line on up, or they'll have no new franchise owners, unless they totally rework their entire model. Which they won't do, since their primary profit comes from real estate, them being your landlord, and franchise fees.
This really has nothing to do with the Minimum Wage issue; that's just because the author of the opinion section piece that the OP referenced, since they could care less.
They did however throw $200M in venture funding behind the company providing the automation software and equipment a few years back. Time to recoup their investment there.
states with higher minimum wage have higher job growth.
Correlation != Causation. It is likely that states with higher employment have more flexibility to raise wages without putting people out of work.
Raising the minimum wage is a blunt method of fighting poverty for a number of reasons:
1. Most people making minimum wage are not heads of household, and aren't poor. They are second or third earners in middle class households.
2. Many businesses that pay low wages, such as fast food, discount stores, etc. disproportionately serve lower income people. So price increases hit the poor the hardest.
3. Most people are not poor because of low wages, but because they are not in the workforce at all. Households in the top quintile have on average 2.2 people employed full time. Households in the bottom quintile have 0.4.
So most of the benefits of higher minimum wages go to people that are NOT poor, and most of the costs, in higher prices and fewer jobs, fall on those that ARE poor. There are better ways to fight poverty, such as the earned income tax credit, that tops up low wages only for people in low income households. The benefits are targeted, and the costs are both lower, and spread through society rather than paid solely by the companies that we need to be creating more jobs.
A great example is Best Buy, I know the poor are not walking in there to $3000 TV with their paycheck.
Do you know any poor people? If you did, you would be astonished at the things they squander their money on.
Because as stated about a bajillion times prior, wage increases do not exist in a vacuum. If wages go up by $x%, and inflation goes up by $x+1%, sure you 'make more money' (in the nominal sense) but you're actually poorer.
Are you saying that minimum wage is what determines the rate of inflation? Not the policies adopted by the Federal Reserve? Or will you acknowledge that it is possible to manage inflation independent of minimum wage?
See also: United States since about 1970. in *REAL* dollars, a janitor made about $17/hour back then.
In real terms, the minimum wage has fallen from $8.90 ($1.45 in 1970 dollars is $8.90 in 2014 dollars) back then. So then do wage decreases exist in a vacuum? Because the minimum wage has been decreasing (in *REAL* dollars) since then. That doesn't seem to jive with what you're saying.
Chuuch. Preach. Tabernacle.
There's tonnes of evidence to back him up. You know, unless you believe in magic every effect _does_ in fact have a cause...
Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/