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May 3, 2022

Chipotle’s digitalisation is changing the Future of Work in foodservice

Chipotle’s ongoing digital transformation is proving that automation in the industry is a positive for both workers and businesses.

By GlobalData Consumer

The issue of labour shortages in the foodservice industry, brought on by the COVID-19 pandemic, is not likely to be resolved any time soon, and this is leading to a surge of investments in digitalisation. While such technology has been met with some caution around the future of the industry’s workforce, Chipotle’s ongoing digital transformation is proving that automation in the industry is a positive for workers, as well as businesses.

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What is the impact of China’s Zero-COVID lockdowns on economic activity, consumer goods and the foodservice industry?

While wanting to protect the country from being overwhelmed by Omicron, China’s adherence to a Zero-COVID policy is resulting in a significant economic downturn. COVID outbreaks in Shanghai, Beijing and many other Chinese cities will impact 2022’s economic growth as consumers and businesses experience rolling lockdowns, leading to a slowdown in domestic and international supply chains. China’s Zero-COVID policy is having a demonstrable impact on consumer-facing industries. Access GlobalData’s new whitepaper, China in 2022: the impact of China’s Zero-COVID lockdowns on economic activity, consumer goods and the foodservice industry, to examine the current situation in Shanghai and other cities in China, to better understand the worst-affected industry sectors, foodservice in particular, and to explore potential growth opportunities as China recovers. The white paper covers:
  • Which multinational companies have been affected?
  • What is the effect of lockdowns on foodservice?
  • What is the effect of lockdowns on Chinese ports?
  • Spotlight on Shanghai: what is the situation there?
  • How have Chinese consumers reacted?
  • How might the Chinese government react?
  • What are the potential growth opportunities?
by GlobalData
Enter your details here to receive your free Whitepaper.

Like most foodservice operators, Chipotle claims to have experienced high turnovers of staff in 2021, yet 90% of promotions were internal last year, with an average of six employees promoted per restaurant. This is down to an environment that allows for greater professional development, thanks to the company’s investment in a more automated workplace such as the recent announcement of its artificial intelligence (AI) kitchen assistant “Chippy”. In the Chief Technology Officer’s words, the company’s “goal is to drive efficiencies through collaborative robotics that will enable Chipotle’s crew members to focus on other tasks in the restaurant”.

While some consumers may be reluctant to use hyper-digitalised businesses, acceptance is increasing. GlobalData’s consumer survey shows that from Q1 2021 to Q1 2022 the number of consumers who are influenced by digitally advanced or “smart” a product or service is when making purchases rose from 66% to 71%.*  GlobalData’s TrendSights Analysis 2021: Digitalization report highlights that this acceptance of and engagement with digitalization is generally greater when it caters to other consumer needs and trends such as convenience, ethics, and personalization.

Chipotle’s well-publicized “Chipotlanes” (drive-through outlets) and digital kitchens are all contributing to a more efficient customer experience, but the brand’s digital strategy is able to see beyond just providing an ultra-convenient service. One reason consumers object to automation and other technologies is that they feel it is creating unemployment across industries, including foodservice. However, through effective marketing Chipotle has suggested the opposite; the technology is helping employees to advance their careers. Companies that take a proactive approach to their worker’s professional development will see favour with the 54% of ethically minded consumers globally who say they are loyal to brands that support social or human rights matters.** At a time when much of the foodservice industry is under scrutiny for the mistreatment of its workforce, Chipotle is showing that automation can be a force for good.

Although increased automation in various forms is becoming a reality across many foodservice brands, Chipotle has also been able to pick up on another common objection from customers – that they seek the “human” element of a product or service. The company’s Vice-President of Culinary, Nevielle J Panthaky, explained how its new AI kitchen assistant “Chippy” would recreate this factor. Panthaky stated that: “To ensure we didn’t lose the humanity behind our culinary experience, we trained Chippy extensively to ensure the output mirrored our current product, delivering some subtle variations in flavour that our guests expect.”  This is important as many consumers value the personal feel and authenticity of hand-cooked food. Ambience or experience was the second most influential factor globally in deciding which foodservice restaurant to visit in Q4 of 2021. Therefore, public-facing brands such as Chipotle must be careful that the nuances of having human staff (front and back of house) on the overall customer experience is not lost when automating parts of the business.

* GlobalData’s 2021 Q1 and 2022 Q1 global consumer survey, “Always”, “Often”, “Somewhat” responses combined.
** GlobalData’s 2021 Q3 global consumer survey, “Completely agree” and “Somewhat agree responses combined.

Free Whitepaper
img

What is the impact of China’s Zero-COVID lockdowns on economic activity, consumer goods and the foodservice industry?

While wanting to protect the country from being overwhelmed by Omicron, China’s adherence to a Zero-COVID policy is resulting in a significant economic downturn. COVID outbreaks in Shanghai, Beijing and many other Chinese cities will impact 2022’s economic growth as consumers and businesses experience rolling lockdowns, leading to a slowdown in domestic and international supply chains. China’s Zero-COVID policy is having a demonstrable impact on consumer-facing industries. Access GlobalData’s new whitepaper, China in 2022: the impact of China’s Zero-COVID lockdowns on economic activity, consumer goods and the foodservice industry, to examine the current situation in Shanghai and other cities in China, to better understand the worst-affected industry sectors, foodservice in particular, and to explore potential growth opportunities as China recovers. The white paper covers:
  • Which multinational companies have been affected?
  • What is the effect of lockdowns on foodservice?
  • What is the effect of lockdowns on Chinese ports?
  • Spotlight on Shanghai: what is the situation there?
  • How have Chinese consumers reacted?
  • How might the Chinese government react?
  • What are the potential growth opportunities?
by GlobalData
Enter your details here to receive your free Whitepaper.

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