Restaurants test remote drive-through ordering

Filed under: Retail |

In May 2003, Steve Bigari opened a McDonald’s call center in Colorado Springs. Six of his 12 stores tested the idea of off-site order taking.

Now other McDonald’s franchises are beginning to latch on to the call center idea.

About 36 people at a call center in California field orders from as far away as Hawaii. They take orders from 40 McDonald’s outlets around the country. The orders are sent to the restaurants by Internet, to be filled a few yards from where they were placed.

The people behind this setup expect it to save just a few seconds on each order, but that can add up to extra sales during the course of a busy day at the drive-through.

Software tracks the productivity and speed of the call center workers. If a red box pops up on the screen, they have 1.75 seconds to click on it. Also, in the break room, a computer screen lets employees know just how much time has elapsed since they left their workstations.

McDonald’s says the remote order taking is still experimental, but it puts an unusual twist on an idea that is gaining traction: taking advantage of ever-cheaper communications technology. The goals of such centers are not just to cut labor costs but also to provide more focused customer service.

The owner of Hardee’s and Carl’s Jr., CKE Restaurants, plans to deploy a similar system in restaurants in California later this year. Wendy’s Restaurants are not yet sold on the idea, said a Wendy’s spokesman.

The operator of one of the McDonald’s centers is developing a related system that would allow big-box stores like Home Depot to equip carts with speakers that customers could use to contact a call center wirelessly for shopping advice.

About 50 McDonald’s franchises are testing remote order-taking, some using Bronco Communications. Others are using Verety, a company based in Oak Brook, Ill. (also the home of McDonald’s), that has taken the concept further by hiring workers in rural North Dakota to take drive-through orders from their homes.

A spokesman for McDonald’s said that the results of the test runs had been positive so far, but that the company has not yet decided whether to expand its use of the technology.

Surveillance equipment franchises available

Thomas Wein, president of MonitorClosely.com, is beginning to sell franchises nationally.

MonitorClosely.com is a home-based business that allows entrepreneurs to sell digital surveillance equipment to business owners and homeowners. The equipment allows clients to see their businesses or homes on the Internet via MonitorClosely.com’s Web site.

Wein said the franchises will range in price from $19,900 to $24,900, which includes a four-day training program, free marketing services and technical support.

Wein’s latest company comes nine years after he co-founded HH Franchising Inc., the parent company of Home Helpers, a home care company for elderly resident.

Kohl’s searching for store locations in urban areas

Kohl’s Corp. is pushing ahead with efforts to enter larger markets targeting urban areas according to a report by Lehman Brothers analysts, who met with executives at the company.

Executives at the Menomonee Falls, Wis.-based company forecast 500 new stores in the next five years. Kohl’s is currently building a new store in Colorado Springs at the Monument Marketplace.

Kohl’s also is exploring growth through the vacant sites of other retailers. Of the company’s 652 units, 25 percent are in spaces vacated by other chains. Kohl’s management sees opportunities for growth at stores left behind by Sears Holdings Corp. and Mervyns, the report says.

In March, Kohl’s year-over-year same-store sales rose 3.7 percent. Total sales rose 12.7 percent to about $1.2 billion. On a year-to-date basis, the retailer has posted a same-store sales increase of 3.6 percent.

Home-related spending strengthens retail sales

Retail industry sales for March (which exclude automobiles, gas stations and restaurants) rose 7.2 percent compared to last year, and increased 0.3 percent seasonally adjusted compared to February, according to the National Retail Federation.

February’s sales increase was revised up from 7.2 percent to 7.8 percent.

March retail sales released by the U.S. Commerce Department show that total retail sales (which include non-general merchandise categories such as autos, gas stations and restaurants) increased 0.6 percent seasonally adjusted from February and increased 7.9 percent unadjusted year-over-year.

This followed a disappointing February, when sales decreased 0.8 percent. From January through March, retail sales growth averaged 0.9 percent a month, the strongest since the third quarter of 2004.

Retail sales, which account for almost half of all consumer spending, were led by increased sales of automobiles and auto parts, which rose 1.6 percent last month after falling 2.8 percent in February.

Purchases of building materials last month increased 1.2 percent and furniture sales rose 0.5 percent. Sales at sporting goods, hobby, book and music stores rose 0.6 percent with increases of 7.9 percent unadjusted from last year.

Furniture and home furnishings reported sales rising 10.8 percent unadjusted compared to March. Health and personal care stores were also among the top retail performers, with increases of 5.9 percent unadjusted from the prior year.

Joan Johnson covers retail for the Colorado Springs Business Journal.