Tate & Lyle
Carst and Walker

Chain restaurants are really technology companies

American technology entrepreneur, Jonathan Kaplan, made a fortune as the founder of camera company, Flip, that was acquired (and shut down) by Cisco. He’s just started The Melt, a food concept that he intends to make into a billion-dollar fast-food chain, and attracted the backing of one of the US’s top technology venture capitalists, Sequoia Capital. The Melt’s offer combines grilled cheese sandwiches (toasted cheese sarmies in SA parlance) served with soup – hearty, healthy, affordable fare. So why are technology entrepreneurs and investors interested in fast food?

According to an article on Business Insider, what makes companies like McDonald’s and Starbucks (Wimpy, Nando’s, KFC etc etc in SA) successful is a combination of process and technology. It’s the same intention behind The Melt.

Perhaps the best comparison, it says, is a company like Toyota. Japanese carmakers took the world by storm because of superior process and technology, woven together through a principle called kaizen, or continuous improvement. Designing and making each car is about eking out dozens of small operational efficiencies which, overall, amount to noticeably cheaper and better cars.

It’s the same thing with McDonald’s. Each burger is really a piece of technology: each ingredient has to be thought through in terms of how it can be procured, sliced and diced, frozen, taken to restaurants all over the world, and then assembled on demand quickly and effortlessly, and how it fits into the whole chain and the company’s offering and brand. Like a new car.

Every item is measured and tested. It’s a manufacturing process. It’s a technology.

The same thing goes with The Melt. Kaplan has gone for grilled cheeses because he found machines that press and grill a grilled-cheese sandwich in record time, which will ensure fast turnover, which improves profitability. The grilled cheese comes with soup because it’s cheap, and easy to store and manufacture. You can order from your iPhone, again, because this improves turnaround time.

It’s a manufacturing and technology process. It’s really not that different from making portable cameras.


Source: Business Insider

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