QSR Trends: Millennials in Franchising

There’s no question that the Millennials are having a significant impact on all areas of business, and on the franchising industry in particular. They represent both customer side and the ownership side of the franchising equation. On the ownership side, Millennials represent not only the youngest group, but the most advanced, tech-savvy individuals in the industry. So how does that affect the QSR industry? We’re already seeing the impact these young innovators are having, particularly in the technology of QSR franchising. These folks grew up with modern technology and have seen the quantum leaps that have been made in the past 20 years. So it’s only natural that they would want to use and improve technology to be compatible with their own entrepreneurial spirit and drive in the franchising industry. Many of their visions have already come to fruition.

Ordering

It’s almost a given that a customer can order a quick meal using their Smartphone/Android/Tablet. Franchises that are on top of this trend include Papa John’s, Domino’s, Subway and many others. Millennials want it FAST! And the smartphone is never far from their hand with a quick thumb.  But that’s only the front end. The franchisor faces the challenge of not only “having an app for that” (ordering), but the infrastructure to support it. What’s the point of quickly placing an order if there’s a delay in getting it ready for pickup? The infrastructure is not just the technology, but in the staff/food preparers and packagers. All must provide a streamlined, seamless experience to the customer.

“Design Your Own” Meal

Another aspect of the ordering scenario to consider is the trend toward “Design Your Own” burger, pizza, sandwich, etc. Most of the current ordering apps cover only the items from their standard menu. The design-your-own option is only available if you’re ordering on-site. Even so, it remains to be seen how this trend will impact the QSR franchise model.  Customers’ culinary tastes have evolved tremendously since giants like McDonald’s Burger King, KFC, etc. first came on the fast food scene. QSR and fast food restaurants/franchises are facing the challenge of maintaining the delicate balance keeping their tried-and-true traditional menu items with adding new items and/or ingredients to satisfy the Millennial palate. Beyond the technology of taking orders from customers, the back-end supply chain of vendors who supply ingredients to the restaurant is also involved.

Pay-n-Go

One of the newest innovations that takes advantage of the Smartphone technology is “ApplePay”. So not only can you order your quick meal with an app, you can pay for it directly from your Smartphone – no cash or credit/debit required. A quick scan of a code on your Smartphone and the funds are deducted from the account you specify. A variation on this theme is the “pay-station” device installed on your table at a casual dining restaurant. No need to wait for your server to bring the check or standing in line with it to pay at the cashier station. Simply pull up your tab on the pay-station screen, swipe your credit/debit card and VOILA – you’re done! No doubt this type of quick-pay will evolve so that you can use the ApplePay technology to simply scan a code from your Smartphone into the pay-station device. This type of quick-pay technology must necessarily be incorporated into the restaurant’s POS system – a crucial link in the revenue stream.

These are just a few examples of issues that the QSR industry must necessarily face and address to attract new customers, and as importantly, to attract Millennials as new franchisees.