Slashdot Mirror
McDonald's Hits All-Time High As Wall Street Cheers Replacement of Cashiers With Kiosks (cnbc.com)
McDonald's is expected to increase its sales via new digital ordering kiosks that will replace cashiers in 2,500 restaurants. As a result, the company's shares hit an all-time high, rallying 26 percent this year through Monday. CNBC reports: Andrew Charles from Cowen cited plans for the restaurant chain to roll out mobile ordering across 14,000 U.S. locations by the end of 2017. The technology upgrades, part of what McDonald's calls "Experience of the Future," includes digital ordering kiosks that will be offered in 2,500 restaurants by the end of the year and table delivery. "MCD is cultivating a digital platform through mobile ordering and Experience of the Future (EOTF), an in-store technological overhaul most conspicuous through kiosk ordering and table delivery," Charles wrote in a note to clients Tuesday. "Our analysis suggests efforts should bear fruit in 2018 with a combined 130 bps [basis points] contribution to U.S. comps [comparable sales]." He raised his 2018 U.S. same store sales growth estimate for the fast-food chain to 3 percent from 2 percent.
Seriously, this^
Wall street is the only part of the country that would cheer the loss of jobs.
Ontario has a $15 minimum wage coming in. Last time I was at Starbucks, all the employees were panicking they're going to lose their jobs.
Then we could get rid of all the tellers at banks!
Someone should make this.
Personal service (and food presentation/quality) can certainly be a large part of why people go out to eat and drink - at proper restaurants.
At fast food (aka "gimme my awful, disgusting tasting, but dirt cheap burger right now!") - not so much.
Also $13/hr isn't much of a raise in 17 years.
Depends on where you live. In 2000, you could live pretty well on $10 an hour. You still can today.
It's worth mentioning that jobs at that factory average out to more than just 40 hours a week, due to the way shifts are structured. Adjusting the same to a 40 hour week would yield an hourly wage of just under $15. On top of that, they tend to have overtime here and there.
In a world of the blind, the one-eyed man is king--and the two-eyed man is a heretic.
We've had the kiosks in Canadian McDonald's for at least a year now and:
- It's a much nicer way to order, no lines and no shouting to be heard
- No worries that the clerk screws up your order
- There doesn't seem to be less staff behind the counter, just more of them filling orders rather than taking them
Overall, it works well enough that we prefer going to McDonald's.
When it comes to dining payment technology, it seems like Canada is light years away (as well as well into the future) than the US. Payment is made at the table with chip reading cards that take debit or credit and we have had the McDonald's kiosks and Canada's economy hasn't collapsed.
Yet when these things are talked about in the US, it seems like they are job killing ideas coming from the devil himself.
Mimetics Inc. Twitter
Employees are more efficient and cost-effective than kiosks.
Until the city passes a $15 minimum wage. Then suddenly kiosks become more cost-effective than minimum wage employees.
look up the performance of the test stores and see that they've actually hired MORE people due to the increased workload.
This is analogous to the way that ATMs increased jobs for human tellers.
Increased efficiency leading to greater demand is known as Jevon's Paradox. It is one more reason why zero-sum reasoning about economic issues is almost always wrong.
..and if the day comes when only a small percentage of the population is fit to task for the remaining jobs?
As jobs are automated, their cost of production drops, meaning money is freed up to spend or invest elsewhere in the economy. This means that not only is there no net loss of jobs, the additional production means that the same income can buy more goods and services. I know that this is hard for some people to believe, but higher productivity and more affordable prices do NOT cause poverty.
If automation caused poverty, then America, Europe, and Japan would be starving, while countries that avoided the "folly of efficiency" such as Ethiopia, Mozambique, and Afghanistan would be rich and prosperous.
Who are these companies going to sell to?
Just for the sake of argument, let's say that "this time is different", and greater productivity really does lead to mass poverty. Then when the rich refuse to hire the poor, the poor could just MAKE STUFF FOR EACH OTHER. Since grocery store pies will only be available to the rich, I can grow apples in my backyard, and barter with my neighbor who can make them into pies in her kitchen. Perhaps we could even use little metal or paper tokens as a medium of exchange to facilitate these transactions.
We could just build a parallel economy. But the difference is that the rich will use automation, while we will do everything manually. But the joke will be one them, because in this alternative universe, automation CAUSES POVERTY, so soon we will be rich while their efficient production will lead them to the poorhouse! HA HA HA!!!
I'm not so sure about that. The McD's near me at work changed to kiosks, and I can swear all the people who used to be at the cashier are now working inside putting food and orders together.
They went with the kiosks because they were busy and there were always long lines to take orders practically all the time. Now the lines are much shorter and there appears to be more people behind the counter. Oddly enough, there are still 3 cash registers (because the kiosks don't take cash, so you still have to pay there, but you can also order there if you don't want to deal with the kiosk or want a customization the kiosk doesn't offer), just packed closer together since you don't gather near them for food.
I'd likely say the kiosks have improved business especially since a lot of the orders are for drinks and such so you can quickly get through the kiosk what you want and not have to pile up with the registers and be stuck behind people with other orders, so you're in and out quicker, too.
But that is one restaurant. Others have not converted to kiosks yet. Remember McD's is about throughput - stuffing quick drink and ice cream orders behind someone with a huge food order is not a good thing, so the kiosks allow for out of order completion because the individual stations are more fully utilized. And more utilization means more staff can man them - where one person might have done drinks and ice cream, the increase in order speeds mean you need 4 people handling the station just from sheer volume. Which likely attracts more people because they didn't want to wait 15 minutes for a drink or ice cream, but can be in and out in 3.
Likely, the restaurant needs MORE people now to handle the increased traffic
And let's also point out that many brainy jobs don't have much market demand. For example, theoretical physicist. Or how about aerospace engineer. There are only so many jobs for those folks - that's why if you have a colleague with an engineering degree slinging code, it's probably an aerospace engineer.
Folks above cite economic theory "Broken Window Fallacy" and whatnot, but let's remember modern economic theory was created during the Industrial Revolution. We are now in a new Industrial Revolution or as some economists argue, Phase II of the Industrial Revolution that started in the late 18th century (1770s). Modern Economic theory is not wrong, but it is incomplete.
Economic theory today is where physics was before Faraday/Maxwell or something like that.
And back in the Industrial Revolution, the folks who displaced by automation were screwed. And that's when the riots started. We are seeing the same social unrest. Other reasons are blamed (immigrants or billionaires) but there are some serious economic changes happening in the USA and the World. And folks are being pushed DOWN the socioeconomic ladder. My standard of living has been declining since 2001. I'm working harder and longer but the rewards are declining - I'm working harder for less. And it's happening to everyone.
The owner and ruling classes are gonna have to buffer the transition or there is going to be some very nasty stuff happening. Venezuela today? Russia 1917?