QSR January 2023


TECH TRIALS AND INNOVATION As labor woes impacted the entire restaurant industry, Jack in the Box began trying out an innovative solution in April by hiring a robot at its San Diego location. The burger chain tested Miso Robotics’ fry-cooking robot Flippy 2, which uses AI to identify and pick up food, then cook it in the correct fry basket. Miso esti mates the robot increases throughput by 30 percent, or roughly 60 baskets per hour. Jack also piloted Sippy, a POS-integrated robot that automatically dispenses beverages and seals cups.

“This was only the beginning of how we will continue to evolve both brands through the shared model,” Harris notes. The goal of the new prototype was to reduce buildout costs by 18 to 23 percent while also increasing real estate f lexibility, says Tim Linderman, chief development officer at Jack in the Box. The model is designed for free-standing locations, but can also be adapted to f it in a variety of spaces such as C-stores, travel plazas, and endcap locations. The design is also meant to attract franchisees, both new and existing.

“With our drive-thru sales skyrocketing amid the pandemic, which accounted for 85 percent or more of a store’s sales, we needed a new prototype that would align with evolving con sumer preferences,” Linderman says. Before COVID, drive-thru accounted for about 70 percent of sales. “We believe that off premises will remain a preferred method of consumption for many of our guests and we want to ensure we are meeting and exceeding their expectations.” In November, Jack in the Box revealed plans to sell at least 250 company-owned Del Taco restaurants—about half of the system’s footprint—to prospective and current franchisees. The move to refranchise Del Taco will help the burger chain land more securitized debt, f inanced by royalty fees from owners. To assist in the effort, Jack partnered with The Cypress Group, a restaurant and franchise investment banking firm with more than 30 years of multi-unit M&A and restaurant refranchis ing experience. While Jack in the Box’s franchise footprint previously com prised about 93 percent of its system, the combined ownership shifted owner-operated units to about 84 percent. The refran chising plan will aid in Jack in the Box’s goal to get back to its previous ratio of company and franchise locations. An asset light model should also help shield Jack in the Box from some inf lationary-related pressures. “Inf lation is something that’s impacting everyone in the indus try right now, so we’ve become more disciplined in our pricing strategy and are investing in the right technology to support that,” Harris says. “Partnering with our supply chain vendors to meet these challenges head on has been key to ensure those relationships remain steady for continuity sake.”

“At the restaurant level, we’re continuing to test and per fect our robotics cooking technology and the f lexibility of our location prototypes to stay on the leading edge of innovation in the [quick-service] space,” Harris says. “We are constantly looking for technology opportunities to drive performance. This could be done with expansion of Flippy, or through other pilot programs that ensure the restaurant operations provide a more seamless, quick and efficient experience for the customer.” Jack hired chief information officer Doug Cook to enhance these efforts by improving AI and removing more costs from the P&L. Cook has more than 20 years of experience in this area, including at Pizza Hut and Sonic. “Innovation is at the heart of Jack in the Box. We had to reignite that across all aspects of our business: marketing, devel opment, operations,” Harris says. An upgraded website, a mobile app update, and a new loy alty program—dubbed The Jack Pack, which has more than 2 million members—round out Jack’s recent digital advances. “We recognized that our current system for our app and website was a barrier that we could improve upon,” adds Ryan Ostrom, chief marketing officer at Jack in the Box. “As such, we partnered with Bounteous to launch a new ordering web site and mobile app that integrates with our loyalty program.” PARTNERSHIPS ARE PARAMOUNT Partnerships are a key area quick-service restaurants are lean ing into to drive interest and sales from younger consumers, especially with athletes and other well-known public f igures. McDonald’s collaborated with K-pop group BTS for both sig

www.qsrmagazine.com | QSR | JANUARY 2023


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