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Home / Business / How McDonald's Spends Millions of Dollars to Reclaim the Crown as a Drive-Through King

How McDonald's Spends Millions of Dollars to Reclaim the Crown as a Drive-Through King



  • McDonald's headquarters and franchisees are investing millions of dollars to accelerate their drive through six years of ever-longer waiting times.
  • On Monday, McDonald's announced a new program to encourage certain franchisees to upgrade drive-thrus, according to internal documents obtained by Business Insider.
  • McDonald's announced in March that it would acquire Dynamic Yield in a $ 300 million deal and add new drive-thrus AI capabilities.
  • The fast food giant has made adjustments behind the scenes to increase speed through drive-through, such as cutting menu items, adding new technology and getting workers to compete with other places during service times.
  • Visit BusinessInsider.com for more stories.

McDonald's drive through waiting times extends further and further. But the fast-food giant is willing to invest millions of dollars to reverse the trend.

Earlier this week, QSR magazine released its annual Drive-Thru Performance Study. Across the industry, driving through time increased by 20 seconds, and customers spent an average of 255 seconds from speaker to order window in 201

9.

Average driving through McDonald's was 284 seconds, or almost five minutes – an increase of almost 11 seconds above last year's average time.

Read more: The Chick-fil-As drive through the service is among the slowest in a new survey – here is the ranking of 10 major chains

The day before, McDonald & # 39; s had announced internally a new program aimed at preventing these trips from waiting any longer. In an internal note dated September 30 and obtained by Business Insider, McDonald's announced a new, optional program intended to encourage franchisees with modernized locations and single-field drive-thrus to upgrade their drive-thrus.

"As we continue to look for opportunities to build our drive-through business and leverage the success we have seen in drive-through this year, we introduce a new drive-by-side drive-through standalone program," the note reads .

The program essentially means that several locations will be encouraged to open a second lane, internally called side by side by side. Over the past few years, as McDonald's has increasingly emphasized kiosk and mobile order sales, locations were required to have 90 cars that came through during rush hour to qualify for a side-by-side drive through ; the new program lowers the figure to 70 cars in rush hour.

McDonald's previously announced a program to encourage franchisees to update their restaurants as part of the company's "Bigger, Bolder Vision 2020" or BBV 2020 growth plan. While many franchisees pushed back on investments required by BBV 2020, such as restaurant redesigns, the National Owners Association said in January that the drive-thru was an aspect of the growth plan that "will actually yield a return on investment."

new drive-through program commitment letter and implementation details have not been completed. However, according to the memo, the new program will be funded in the same way as BBV 2020 – franchisees who choose to participate will pay 10% of the cost upfront, and then receive a five-year rent reduction equal to 40% of the total project cost.

McDonald's quest to fix drive-thru

  mcdonalds drive thru

McDonald's doubles down on drive-thru.
McDonalds


McDonald's driving time through time has been getting longer every year for the past six years, according to QSR magazine.

The decline has been part of an industry shift, as waiting times across the industry have grown longer, menus have become more complicated, and managers have focused on store innovations such as tablets. In addition, more customers mean longer waiting times – and QSR found that Chick-fil-A and McDonald's tend to have the most people waiting in line.

McDonald's declined to comment on this article. However, CEO Steve Easterbrook told investors during a June earnings call that global executives and other executives decided earlier this year that it was time for the company to make a serious effort to improve the drive-thru.

"We had a kind of white-eyed conversation in early March. And we all agreed that we were going to renew some emphasis on driving through service hours," Easterbrook said. "They have gone wrong with most of our markets for three or four years for reasons we can understand as we have added more to our business, but we knew it was not a continuing trend."

Later in March, McDonald's announced that it would launch artificial intelligence Dynamic Yield for a $ 300 million deal.

Dynamic Yield's technology will allow vehicles through menus to update instantly. For example, if a customer orders a coffee, an AI-enabled drive through could suggest that the customer add an order of donut pins, and ideally convince the customers to spend more. McDonald's began testing drive-thrus technology in 2018 and plans to roll out drive-thrus technology by the end of the year.

In September, McDonald's announced another acquisition that could help drive-through: Apprente, a startup for voice technology. According to a press release from the company, it is expected that Apprente "will allow for faster, easier and more accurate ordering."

Countless fine adjustments can cut seconds from driving through times

  McDonald's Signature Crafted Burgers

McDonald's Signature Crafted Burgers did not cut.
Hollis Johnson / Business Insider


While the acquisitions have been McDonald's most obvious drive-through investments, the fast-food giant has made many adjustments behind the scenes to speed up the drive over time.

"When you talk about progress in drive-through, I mean honestly, it will improve," Easterbrook said in June. "We want to get step-by-step improvement week-on-week-on-week. So every time a customer comes back, such as a week or two later, they may notice a few seconds difference."

Menu simplification has helped speed up service time, according to Easterbrook. In April, news broke that McDonald's was cutting its more expensive Signature Crafted Recipes burgers and sandwiches from the menu, sniffing items from the menu at night.

Read more: Leaked documents reveal that McDonald's is in the process of slicing objects from its night menu

McDonald's is trying to gamify the process with an incentive program that pits placements against each other when competing for the fastest service hours. According to the company, competition between markets around the United States earlier this year helped speed up service hours and increase customer counts.

McDonald's also introduces new technology and diagnostic tools that allow workers to get a better handle on what can slow the drive-thrus.

"They can basically decompose the various elements of a drive through a visit to a customer in the most important seconds," Easterbrook said in June. "So how long do we take orders? How long do we take payment? How long does it take us to collect the food and present it? How many cars do we ask to pull out and bring the food later?" [19659007] Do you work at McDonald's or any other fast food chain and have a story to share? Email ktaylor@businessinsider.com.


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