Like most industries, the food and beverage sector is currently in the throes of a major digital transformation. As consumer preferences shift and economic conditions squeeze profit margins tighter than ever, restaurant technology is helping service businesses to stay agile – whether it be by reducing wastage with restaurant POS systems or expanding to online orders with third-party delivery software.
However, with frugality remaining a top priority among businesses, and so much emerging tech to choose from, knowing which solutions are worth investing in isn’t always easy. So, if you’re intent on safeguarding your business’s future, this guide rounds up the most important restaurant technology trends to be aware of in 2024.
From digital menu boards to customer loyalty software, we take a look at what solutions businesses are using to overcome adversity, as well as what roadblocks are preventing businesses from making investments.
What Challenges Are Food and Beverage Businesses Facing in 2024?
The service sector is faced with a fresh set of challenges every few years, but the resiliency of businesses has been tested more than ever in 2024.
As soaring inflation rates put pressure on suppliers, 97% of businesses have reported rising food costs according to recent data from the National Restaurant Association (NRA). While many restaurants are responding by hiking up the cost of items, this isn’t a viable option for all – with almost half of consumers cutting back on luxuries like meals, in favor of affordable home cooking options.
The pandemic-induced ‘great reshuffle’ has also resulted in a labor crisis for the food and beverage industry. As an unprecedented number of workers resign from hospitality positions, the NRA also reveals that 45% of restaurant operators claim they need more employees to meet consumer demand, despite the growing popularity of self-serve technology.
What’s more, while off-premise ordering options are helping businesses unlock new revenue streams, third-party commission fees continue to bite into business profits, with a quarter of businesses paying more than 20% commission on each online order.
Despite these challenges, business owners remain optimistic – thanks in part to the increased adoption of smart restaurant technology.
Here are eight of the key restaurant technology trends to know about in 2024:
1. POS Systems Are Now Virtually Ubiquitous
POS systems have been growing in popularity for decades, providing businesses with a streamlined way to make orders, take payments, and streamline a range of other business processes. So, it should come as little surprise that they’re now the most common technology used by service businesses, according to our survey of 552 food and beverage professionals.
Specifically, we found that 75% of hospitality businesses currently use a POS system, with a further 27% planning to upgrade their service or switch to a different provider in the next 12 months. This was closely followed by surveillance and security systems, which are used by 59% of businesses.
As businesses seek to streamline processes with cost-effective technology, using solutions like Square POS that let you manage orders, payments, check stock, and more through one unified dashboard is a no-brainer. The technology’s growing popularity also indicates a shift towards a unified approach to business management.
Businesses see POS systems as an order and payment device first
It’s worth noting that while POS systems are versatile pieces of business technology, their in-house payment processing features continue to be the #1 draw. According to our data, the majority (54%) of food and beverage businesses cite efficient order and payment processing as the primary benefit of using a POS system, with ordering processing features being the second most desirable feature (16%).
With an increasing number of solutions seamlessly integrating their payment terminals into fully-fledged POS systems, it’s no surprise so many businesses are using POS technology as a payment tool first.
This trend is also evidenced in search data. When analyzing search queries, we found that “POS” is increasingly being searched alongside terms like “Payment terminal”, “payment gateway” and “mobile payment”, representing a blurring of distinctions between payment devices and traditional POS systems.
This all said, for restaurants looking to get the most out of this technology, we’d recommend making use of the full range of POS features, including restock alerts, customer loyalty tools, and table and staff planning.
2. Waste Will Be Cut Using Software
One way business owners plan to shave down costs without compromising on standards is by adopting technology to track and reduce wasted stock.
Our study found that more than 1 in 5 restaurants (21%) are planning to purchase food cost management software within the next 12 months. This makes it the most common technology businesses are looking to add to their roster, closely followed by digital menu kiosks and loyalty program software.
Food cost management software provides users with real-time reports on stock wastage levels, so you can see clearly just how many meals are only feeding the rats and raccoons. The software is already being used by 40% of hospitality businesses, but its growing adoption is a clear indication of how rising interest rates and a challenging macroeconomic environment are influencing buyer intent.
3. Food Delivery Tech Is More Popular Than Ever
While consumer preferences were shifting at a gradual pace before 2020, the pandemic forced restaurants and quick-service businesses to pivot to take-out and delivery to remain afloat – resulting in the rapid growth of third-party delivery apps like DoorDash, GrubHub, and Uber Eats.
Now, even with in-person dining options on the table, food delivery apps remain more popular than ever, with research from Statista revealing that the apps collectively attracted 53.9 million US users in 2023, compared to 45.6 million users in 2020.
Out of all the third-party software that businesses are using, DoorDash is proving to be the most widely used, with the food ordering and delivery platform currently making up 66% of the market share, compared to Uber Eats in second position (23%).
Delivery services are now so popular that any restaurant technology provider worth its Himalayan sea salt will support and integrate with these apps. One good example is Square’s restaurant POS package, which makes it easy for hospitality businesses to accept and fulfil delivery orders online, as well as good old fashioned takeouts.
4. Digital Menu Kiosks Are Replacing Staff
Ever since the pandemic, hospitality businesses have been dealing with a labor crisis, as service workers increasingly opt to find jobs in other industries. As a result, an increasing number of quick-service and fast-casual restaurants have been utilizing digital kiosks to overcome staffing challenges – and their use is only expected to rise going forward.
According to Tech.co’s survey, 36% of restaurants have purchased digital menu kiosks in the last 12 months, and a further 20% plan on purchasing the tech in the next year. This makes them one of the most popular new restaurant investments of 2024, second only to food cost management software.
With many self-order kiosks being built into affordable POS systems, it’s no surprise they’re being adopted by businesses looking to keep orders ticking while freeing up staff time. Still, the US is rolling them out at a much slower rate than other economies, with Asia Pacific currently holding the majority of the market share.
5. Loyalty Software Is On the Rise
As surging inflation rates put a damper on consumer spending, customer retention continues to be a major struggle for small food businesses. To fortify these problems, the food and beverage industry has been leaning on customer loyalty software – a service that encourages repeat buying through rewards and follow-up offers.
The results from our survey found that while only a quarter of businesses use the software, 65% of them purchased it within the last 12 months. These figures reveal how the technology is on the rise, as businesses continue to contend with fluctuating customer footfall, made worse by cost of living increases.
With many POS systems now offering customer loyalty features in-house, syncing customer loyalty information with your wider business data is quick and straightforward too. Read our full guide to POS features to learn more about customer loyalty features, as well as other useful point-of-sale capabilities that could benefit your restaurant.
6. Cash Is No Longer King
In the US, 80% of payments are now being made digitally, and this reality is no different for service businesses. With digital payments proving to be more convenient, safe, and secure than cash-based methods, it’s no surprise that they’re being adopted so readily by restaurants, quick-service businesses, and bars.
Contactless methods like mobile payments have witnessed the biggest spike recently, with 76% of restaurants adopting the digital payment method in 2022 according to findings from TouchBistro. However, while the trend towards digital payments is undeniable, most businesses aren’t planning to ditch the cash draw anytime soon.
Amid concerns about a cashless future, several major cities including New York, Philidelphia, and San Francisco have rolled out legislation to ban fully cashless payment policies. What’s more, 56% of Americans prefer to pay with cash on occasion, so there’s still a clear business incentive to accept the physical tender.
Learn more about the pros and cons of a cashless society.
7. QR Payments Are Here to Stay
Another trend accelerated by the pandemic is the move towards Quick Response (QR) restaurant technology. The digital payment method lets customers order from menus using their mobile devices to scan a QR code, completely bypassing the need for staff intervention.
By enabling contactless dining experiences, the technology provided a lifeline to businesses throughout Covid-19. Yet, as food and beverage businesses continue to grapple with staffing shortages, the payment software is still being relied on heavily to take the pressure off servers, with research from PYMNT finding that use of the software has increased by 150% in the last two years.
QR tech has also been found to help restaurants save 30-50% on labor costs according to the payment service provider Cheqout, so it’s likely they’ll continue to be adopted by businesses keen on scaling back costs.
8. Restaurants Are Reluctant to Spend Big on Technology
While restaurant technology continues to be instrumental in helping food and beverage businesses overcome major challenges, a number of purchasing roadblocks remain. Our survey found that high initial costs are the number one barrier preventing business owners from investing in new solutions, with 41% of respondents clamping down on spending for this reason.
Escalating concerns over spending have also resulted in sluggish software upgrades. Specifically, our findings reveal that food and beverage organizations are upgrading software 50% slower than businesses in other industries.
As hospitality businesses continue to get stung by growing wholesale costs and evolving consumer preferences, this reluctance to invest in new and existing technology is a clear reflection of industry-specific challenges. It also highlights the importance of making targeted, strategic purchases, that facilitate long-term success.
How to Choose The Right Restaurant Technology For Your Business
Adapting to the new digital landscape is the best way restaurants can continue to survive and thrive into 2024. However, making the right decisions for your business isn’t always easy, even for those with a keen eye on industry trends.
When considering what solutions are best for your food and beverage business, we recommend prioritizing options that could offer you the greatest long-term returns on investment (ROI). Being mindful of how technology will help you down the line is one of the best ways to future-proof your business, whether it be by using self-service kiosks to reduce labor costs, or loyalty software to drive up sales.
If heavy upfront costs are deterring you from making a purchase, choosing a pay-as-you-go solution, such as Square POS, might be the most sensible course of action. As a major contributor to the restaurant technology industry, Square has chosen to sponsor the creation of this article on restaurant trends, however we also happen to independently rate Square as the best POS system for small businesses, which is based on our impartial research methodology.
Tech.co’s Research Methodology
Tech.co is a trusted news and review site that aims to help business owners know more about technology, and find the best solutions to work smarter and grow securely. As part of this mission, we compiled a survey of food and beverage professionals, to get their opinions and feedback on restaurant technology.
We obtained original data from a total of 552 restaurant owners, bar owners, business managers, and food service managers across the US.
Our survey combined both qualitative and quantitative data, to gain a holistic understanding of the trends and challenges shaping the food and beverage industry.
