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Serving Up Wireless
Serving Up Wireless

European restaurants have used handhelds for credit-card processing for years, and some have even taken orders wirelessly. Now, with costs dropping, the systems are starting to take off in the U.S. Though not without glitches, they're being adopted by more and more restaurant owners eager for an extra helping of better service and increased profits.

It was a waiter's nightmare. In the middle of the lunch rush on opening day, a party of 22 came in - and wanted 22 separate checks. But as Michael Benner entered each person's order into his Compaq iPaq and hit "fire," dispatching the orders to a kitchen printer, the kitchen staff jumped into action. Before he had worked his way down to the end of the table, runners began arriving with food.

Other days don't go as well. Sometimes, when Benner is showing off his gee-whiz toy to the latest customers, a dreaded error message appears and the order is vapor. So he whips out the old technology - pad and paper - and takes the more traditional approach.

Such is life on the wild frontier of on-premise wireless restaurant applications. Lacking the "that will never work" mind-set of some of the established food service community, first-time restaurateur Jim Wade launched his Big Jim's Old South Bar-B-Q in San Diego last February with a cutting-edge wireless solution from Ameranth Technology Systems and Aloha Technologies. Now he boasts that he's the proprietor of the most high-tech BBQ house in the West.

Restaurant application developers expect Big Jim's to be joined by many others in this wireless foray, now that several elements are in place: affordable, reliable, open-platform handheld hardware and wireless LANs, a host of new mobile restaurant applications, and a compelling vision of the benefits.

But are restaurants ready? Application developers admit just a handful of customers are installed - and many of those are in beta. And while anecdotal evidence is there, benchmarking and real measurement haven't yet taken place.

Compelling Savings
Yet the early examples are nothing less than cool.

  • Guests lounging poolside at the Las Vegas Four Seasons get faster satisfaction for their mid-afternoon cravings because wait staff can instantly transmit orders to the distant kitchen - while quietly verifying that the charge can correctly be made to the room.
  • In a five-month test, customers wielding WAP-enabled cell phones in Long Beach, California, could call up the menu for Johnny Rockets via go2, punch in their orders, then stop by the burger joint to pick up their packed food.
  • Big Mac lovers backed up at the drive-thru at certain McDonald's around the noon hour are greeted by a crew member wielding a ViA, Inc., handheld terminal, used to wirelessly dispatch orders to the kitchen. Customers move through the line faster, enabling the restaurant to serve 30 more cars during the lunch rush.
The business case being cooked up by restaurant application developers certainly sounds tantalizing. Getting rid of all the back and forth to put in orders means each waiter can do more, a benefit borne out at Big Jim's. "I can cover eight to ten tables," waiter Mike Benner says. "At most restaurants you have four to five." Some use lower-paid runners to deliver food.

But productivity isn't the only goal - the idea is that wait staff have more time to schmooze - and sell - since they don't have to run to the back or wait on line to enter the order into the POS system.

Handheld wireless units also provide waiters with a cheat sheet - a quick prompt that suggests upsells to appropriate items. It's the "would you like fries with that?" approach. That means higher-average checks.

And with orders dispatched to the appropriate cooking stations and spaced more evenly, chefs are better able to manage workflow.

Then there's payment. European restaurant patrons have been paying at tableside for years - in fact, in France, the staff is prohibited from removing a credit card from the full view of its owner. With a rise in credit-card skimming - capturing numbers with a surreptitious swipe through a hidden mag stripe device for later illegal use - consumers are likely to be increasingly wary of the disappearing card. Some restaurants even equip wait staff with portable printers and money pouches, so receipts and cash can also be handled right there.

Wireless tableside transactions also shave more time off the visit, delivering the last benefit: more table turns.

Not to be overlooked, especially for early adopters, is the wireless high-tech image. "It seems like a more high-tech, efficient restaurant," says Big Jim's patron Charlie Busser. "It cut the time I waited for food to come out in half."

Image is one reason Wagamama Ltd., a chain of cutting-edge London noodle bars, adopted wireless handhelds five years ago. The chain's nine restaurants use handhelds and Geac Computer Corp. software to whiz orders off to six separate cooking stations. That makes Wagamama not only edgy, but efficient; despite its upscale china plates and real silverware, the operation turns tables in 14 minutes. "The real benefit of handhelds is in a busy restaurant, especially a restaurant that has a queue," says Jay Travis, operations director. "We take drink orders and hand drinks to them in the queue."

All Segments Stand to Benefit
Table service operations are not the only beneficiaries. Several McDonald's in Tampa, Florida, found the line-busting not only pleases customers, but increases order accuracy, all with minimal additional training, since their mobile systems use the same software that runs inside the store, says Carlos Pietri, operations manager for area McDonald's.

At resorts and stadiums, far-flung service personnel can process orders and payment via wireless LANs or WANs, with full access to the right menus, guest account lookup, and other remote files. Last summer, luxury-box wait staff at the U.S. Tennis Open in Flushing Meadows, New York, sped gourmet treats like Louisiana Cajun jambalaya and Chef Jacques Torres's chocolate-lover's finale to elite fans, using handheld terminals from MICROS that instantly whisked orders to Restaurant Associates' temporary kitchens.

Another form of wireless is for delivery operations, which can use wide area wireless devices to communicate with service personnel and process payments at the delivery point.

While wireless is often closely associated with mobile terminals, restaurant operators are also outfitting traditional point-of-sale (POS) terminals with wireless nodes. At the Las Vegas Four Seasons, that was a chief motivator for installing the wireless LAN. "If you ever have to recable a terminal you find out wireless is actually less expensive," notes Russ Ketchum, regional director of IT. With several resets and temporary cashier stations set up since its March 1999 opening, the investment has already paid for itself, Ketchum says.

Industry Under Siege
Such impact strikes a chord with restaurateurs, who face a phalanx of challenges. One is competition, not only among themselves but from supermarkets, convenience chains, even other forms of entertainment. As in retail, customer service is emerging as one of the most powerful weapons in winning the loyalty of fickle diners.

Labor is another big challenge, with restaurateurs suffering high turnover. Getting and keeping workers was their number one challenge in 2001, according to the National Restaurant Association.

Economic hardships are also pressing the drive for efficiency. When waiters note orders twice - once on paper, then again at a terminal - the likelihood of errors goes up. That has a ripple effect on food costs, inventory, and ultimately, profitability.

So if the benefits touted for wireless applications are true, restaurants stand to see real impact. Now it has to be proven.

Price points and wireless technology hurdles kept restaurants away from early iterations. But the industry has a precedent for jumping in when technology's value is right. Touchscreens, now just taking hold in retail, have been a mainstay in food service for years. Early support by developers and an ideal fit for the restaurant environment had operators tossing aside their membrane keyboards for touchscreen terminals years before other POS users saw fit to do so, despite the then-high price points. Independent restaurants forged the way, followed by chains.

And some say the market is primed. "People have talked about and wanted to use wireless for years," says Win Platt, senior VP and COO at software developer POSitouch. "But once they put the pencil to the numbers they shied away from it. Now it's at a price point people can justify."

But What About...
The prospect of a technology solution to such problems rates five stars for many. But does the pretty picture reflect the real world? At least partially. Some niche markets within food service have used wireless technology for years with success, such as in stadiums and arenas. And that was using older, slower, proprietary LANs and high-priced hardware.

Many beta testers rave about the impact on their restaurants. At the three Skyline Chili locations in Cincinnati owned by Pete Perdikakis, installing handheld wireless POS in conjunction with a new inventory system leapfrogged the operation from a totals-only, largely manual system to a highly accurate, automated one.

Accustomed to shouting orders to cooks at the open-kitchen's steam table, waiters now whip out Hitachi tablets and touch in orders via PixelPoint POS software. Later they print the receipt tableside. Food costs have dropped 10%, already-fast service is even quicker, and revenue has jumped 30% since the wireless sytems were installed in the three restaurants in early 2001. They even use the terminals as time clocks.

But for every Skyline Chili there's a Prejeans, a compatriot in Lafayette, Louisiana, that took a bite of beta with less mouthwatering results.

Owner Bob Guilbeau loves to innovate with food and technology. When he spotted waiters along Paris's Champs-Elysees wielding handheld terminals for payments back in 1995, he returned to the States hot to install. He finally found a system five years hence, and became the developer's first wireless customer. Two years later, the system has yet to be fully implemented.

"In my business if you do what everyone else does you get what everyone else gets," says Guilbeau. "I made a leap of faith." So he's willing to suffer the occasional system crashes, waiting until the struggling developer can afford to come install the credit-processing module and all the other hardware, software, and training hiccups involved in getting a full-service restaurant system off the ground. The jury is still out on whether the investment has been worth it. "Until all the features are available we can't judge the benefits."

When it works, it's great. Waitress Larie Barentine says it gives her more time to socialize with customers and serves as a great conversation starter. She's even hoping to use it to keep track of her regular customers. But Guilbeau fears the day they can unplug the old reliable Panasonic terminals is far away - especially if he has to start over with a new vendor.

Issues Linger
The truth is, there are still a number of issues to be worked out before the average restaurateur considers wireless apps a serious option:

  • Green applications: A few developers such as industry stalwart MICROS and POSitouch have had wireless applications for nearly a decade. But the latest generation, based on relatively new operating systems such as Pocket PC and Palm, are just being introduced. Just a third of restaurant software developers surveyed by IHL Consulting Group, Boynton Beach, Florida, last May said they had wireless handheld POS apps, but 75% planned to within 12 to 18 months.

    Frequently, developers must alter applications considerably to present a logical sequence of menus and pulldowns, especially for smaller screens. Some are equipping handhelds with a subset of the functionality of their full-strength POS systems, while others port the entire app over. Still others are turning to Ameranth, a wireless middleware provider, to do the conversion for them, benefiting from the company's experience but introducing another layer into the solution that must be supported.

    As at Prejeans, early tests haven't always been smooth. Big Jim's has experienced 90% uptime and three big crashes. A number of beta testers have suffered delays in enacting credit-card processing - even five-year user Wagamama has yet to implement it. Training can be an issue: it can take a good month to become conversant with the interface. Still, other betas faced little more than battery management obstacles in their implementations.

  • Hardware: Cheap or rugged? The ubiquitous - and low-priced - PalmPilot has whet appetites for cheap solutions. But off-the-shelf models usually lack the necessary hardening for restaurant environments - at least one of Big Jim's iPaqs took a bath in BBQ sauce and now is known to screech without notice. The rugged-ized ones, from the likes of Symbol Technologies and Fujitsu, cost in the $2,000 neighborhood. And at least one high-profile rollout has been plagued with hardware failures.
  • Operating system: Palm OS or Windows CE/Pocket PC? Palm is more prevalent in hotel applications, while a CE appears most common in restaurants, says Ed Rothenberg, VP of business development, restaurants, at Micros. But hotels, of course, often house restaurants. According to the IHL study, 85% of restaurant developers plan to support Windows CE for handheld POS, while 65% will support Palm, and 50% DOS. Clearly, many are hedging their bets by accommodating more than one OS.
  • Security: Technically speaking, a number of wireless application developers flinging credit card info through the air are not certified to do so, according to Kevin Ritschell, senior project manager with VeriFone. They're supposed to get any modification recertified by the big card processors, and not all build encryption into applications or make sure the wireless LAN itself is secure. But the risk of a n'er-do-well intercepting airborne credit card data, he admits, is more theoretical than real.
  • Skepticism: How will customers feel when their server is spending more time gazing at a screen than at them? At the Las Vegas Four Seasons, patrons are often surprised to see high tech so boldly displayed, when the chain normally takes pains to hide its hardware. When the novelty wears off, wireless handhelds could be a turn-off.

    Eye contact breaks off for waiters new to the system, admits Prejean's waitress Barentine. "But once you get used to it, you don't lose as much. I'd rather lose eye contact for a few seconds at the table than have to leave them to run back and forth and they have to flag me down."

  • Standards: Most devices on the market are currently compatible with IEEE 802.11b, an interoperability standard for wireless LANs that operates at data rates similar to wired Ethernet. But now coming to market are 802.11a devices, which enable faster and wider-bandwidth LAN activity. The new systems operate in the 5GHz spectrum, making them noncompatible with some 802.11b equipment. Then there's the big question mark hanging over Bluetooth.

    The average restaurant operator probably cares little which IEEE standard their LAN uses. But anyone pioneering a new technology is likely interested in taking advantage of new developments, and that would be difficult if their wireless LAN couldn't run them.

And Now We Wait
Most of the hurdles, though, are temporary, and with at least some early users already posting real results, it seems only a matter of time before wireless terminals rank right up there with industrial ovens and beverage dispensers as standard food service equipment. L. Carlos Rodriquez, CEO at developer DynerTec, predicts it will be six months to a year until the market truly embraces the technology.

Once basic functions such as ordering and payment are solidly established, restaurateurs will start exploiting wireless networks for accessing customer loyalty programs, performing manager functions, and other as-yet-unimagined functionality. Already, patrons at the Las Vegas Four Seasons can piggyback on the establishment's wireless LAN for Internet access from their own or hotel-supplied PCs. Some dream of the day when customers can whip out their own WAP devices on the premises and peruse menus, place orders, and even pay without employee interference.

Perhaps the most telling comment on the current state of the art in wireless restaurant applications is summed up by Big Jim of BBQ fame: "When it's working, it's beautiful."

About Lisa Terry
Lisa Terry is a freelance writer based in Allendale, NJ, who specializes in covering technology and business issues.

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