Consolidation is coming to the restaurant’s back office
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The consolidation of catering technology companies has been a topic for years. And in recent months, deals such as PAR’s acquisition of the Punchh and Squarespace customer loyalty platform, hotel company Tock, suggest that mergers and acquisitions are alive and well in restaurant technology.
News from the last week suggests that the next big area in restaurant technology to consolidate is the restaurant back office.
Toast, which aims to be the Swiss army knife of restaurant technology, recently announced the acquisition of xtraCHEF, whose software digitizes and organizes administrative and administrative tasks. Think about accounting, scheduling, inventory management, and budgeting. While Toast’s partner network offers a number of different back-office software platforms restaurants can integrate with their systems, the full acquisition of xtraCHEF means Toast can be added to its own list. ever-growing software products for restaurants.
Shortly after Toast’s announcement, Restaurant365 announced the acquisition of Compeat, which digitizes work, accounting, supplier relations, and other tasks for restaurants. In this case, Restaurant365 is itself a back office business, with software that does much the same as Compeat. The acquisition suggests that Restaurant365 wants to increase and improve its capabilities in this area.
Both deals are notable because until now the back office has been less of a priority for restaurants and has received significantly less investment money over the years than front-of-house technology and technology. customer-oriented. Amid a broader industry consolidation (see above), last week’s offerings suggest a greater need, or at least a desire, for restaurants for more precise management of their accounts, inventory and other behind-the-scenes tasks.
It is not too surprising. The past year has devastated the restaurant industry. With the exception of chains with deep pockets a la Chipotle, those that have managed to snag operate with even thinner margins than they were before the pandemic. Better management of stocks, invoices, supplier relations, etc. means a better holistic view of cost trends in a restaurant, which could ultimately save businesses money at a time when there isn’t much to do. Those foodservice tech companies that may rush to add more back-office tools in the hope of staying on top of a foodservice tech space that’s currently more bloated than the pre-COVID flywheel menu of Taco Bell.
Whether scanning the entire back of the house will make a noticeable difference in restaurant margins will only be determined at some point, when more restaurants have replaced the pen and the paper by mobile apps and other software. If they do. After all, these systems are not free to implement, so it remains to be seen how many restaurants, especially small and / or independent ones, will do so in the near future.
In the meantime, the consolidation of catering technologies will continue. It wouldn’t be so surprising if a business like Restaurant365, which while large still only focuses on one area of the restaurant, were taken over by an even larger all-in-one platform like Toast.
Stay tuned . . .
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