I was looking through my news feed the other day when I spotted this article from Nation’s Restaurant News: “Cinnabon president talks redesign and software”. I figured it would just be another well-known restaurant franchise announcing a move to full-on automation of their stores. What I read though surprised me.
The article is short, but chock-full of insights into the major changes coming to the popular mall franchise:
- Joe Guith, Cinnabon’s brand president, is revamping the Cinnabon brand to attract more millennial customers and promote more franchise growth. (Smart move.)
- They’ve conducted research around how to properly establish a brand—from the food they sell to the color palette of the stores to the size of their display case—and are taking practical steps for implementation now. (Good, though I wonder why this wasn’t done earlier.)
- Cinnabon has signed on with Revel to provide and manage their POS systems as well as to integrate with back office functions. (Sounds good…)
- According to Guith, until recently they didn’t have employee scheduling software nor did they have a way to track and predict food costs. (Wait, what???)
Cinnabon currently has 747 U.S.-based franchises and 593 outside the country. They also stand at #55 on the Franchise 500 list. How has such a well-known brand of this size and ranking gone this far without essential operations management tools like cloud-based POS, online scheduling software, or food cost tracking? This is what Guith had to say:
“We had some franchisees that were doing it with their own systems, but we weren’t doing it as a company. You could say, ‘What were you doing? Were you a bad franchisor?’ But at the prior [sales volumes] they couldn’t afford to pay for all these systems… Now I’m doing it for less than a [traditional] point-of-sale [system]. So the ability to leverage that technology and deploy it, plus our pretty dramatic increase in AUV has brought us to a point where we can do it.”
While this is an outstanding testament to the power of cloud-based software solutions, it’s truly surprising Cinnabon hadn’t looked into more affordable and adaptable technology solutions for their franchisees—and their overall brand—sooner. Rising food and labor costs are a big problem for the restaurant industry. If anything is to be learned from what companies like McDonald’s, Wendy’s, and Carl’s Jr. are doing right now, it’s that there’s no time better than the present to take action.
There’s no doubt in my mind that the Cinnabon-Revel partnership is going to be key in helping them gain more control over rising food and labor costs. There is one thing I would like to stress for restaurant operators and franchisors panicking about growing costs or lack of control over locations:
It doesn’t matter how large your business or extensive your chain is. There is a solution that will be right for you and that will help rein in costs without blowing your budget. The Wendy’s standalone kiosk probably isn’t it, but perhaps something more closely resembling the Cinnabon POS and back-office integration would help. There isn’t going to be a one-size-fits all solution, so your safest bet might be to find something with more flexibility and that will allow you to mix-and-match solutions that fit your unique business needs. Whatever the case, now is the time to bring better control to your operations management.