Ono Food Co.'s Ono Blends truck is powered entirely by robotic technology. Customers order via kiosk ... [+]
Automation in the restaurant industry isn’t necessarily new. We’ve seen robots flip burgers and pour coffee for a few years now. But adoption of the technology is starting to pick up from a drip to a trickle.
Zume, for example, is rolling out its largely automated mobile kitchen fleet through a partnership with &pizza. Zume CEO Alex Garden has flat-out said that the company’s priority is to automate the business as much as it can to free up repetitive jobs so employees can do more of the things they enjoy.
Now, another concept is looking to go one step further. Ono Food Co. announced this week that the first mobile restaurant powered entirely by robotic technology, called Ono Blends, will open later this month in Venice, California. Not coincidentally, the company was founded by two people who know quite a bit about robotics and automation. CEO Stephen Klein came from robotic coffee bar Café X in San Francisco, and previously worked at Instacart. CTO Daniel Fukuba directed the engineering team at a firm that provided automation for Zume, SpaceX, Tesla, Apple and more.
Klein said the biggest objective with the Ono Blends launch is to provide healthy fast food options to customers wherever they are throughout the day, and that the biggest differentiators between Ono and other mobile concepts is that it is fully automated and its 56-square-foot space can be assembled anywhere.
“We think future of food isn’t mobile but modular,” Klein said.
There are plenty of benefits behind such an approach, including a significantly lower barrier to entry compared to a traditional brick-and-mortar restaurant. Occupancy rates for brick-and-mortar locations typically take up to 8% to 10% of a restaurant's gross sales, if not higher in a market like LA.
For Ono, however, automation is the headline.
“Because of that automation, (the product) is better, faster and cheaper,” Klein said.
Just how Ono achieves “better, faster and cheaper” requires a multi-tiered answer. Klein said every step of Ono Blends’ assembly process is monitored by hundreds of sensors to ensure no spillage, cross-contamination or inconsistencies. He adds that Ono’s technology creates 60 blends per hour, versus the industry standard of about 20, and uses about 28 times less water because of its cleaning system.
Such efficiency yields cost savings. But most of those savings come from the real estate piece and the labor piece. Klein said Ono pays a livable wage by Los Angeles standards, but its Ono Blends truck has just one employee on board, sometimes two. These employees serve as “Ono Guides” to engage customers and educate them about the ingredients, etc.
“Our goal is to serve higher quality food with a focus on sustainability and that costs a lot. Our food cost is higher than most concepts, at 35% of our gross revenue,” Klein said. “But we can be more efficient and save on labor and real estate and, because of that, we can charge customers two to three times less than other concepts like Moon Juice.”
For context, the cost of a 20-ounce smoothie, such as the avocado and matcha, from Ono Blends is about six bucks.
How the concept works is simple. Customers order through a kiosk on the truck (and, soon, via a mobile app), which spins into motion the robotics system that creates a smoothie within 60 seconds. Ono started with smoothies because it is agnostic to the time of day, Klein said.
The company’s objective is to expand into other culinary categories by 2021, including through a possible partnership with a celebrity chef.
For now, however, another narrative has taken the spotlight and that is the emergence of automated concepts and automation in general. We’ve not only seen it in startups like Zume, but also with giants like Domino’s testing driverless delivery, or McDonald’s testing robot fryers.
Some investors seem to like the potential of a fully (or mostly) automated concept. Zume secured $375 million in funding late last year and is valued above $2 billion. Ono has also received undisclosed funding and Klein is adamant about scaling into other markets in the next year.
We’re very much on the ground floor here, but if startups like Ono can successfully prove efficiencies, expect automation adoption to turn from a trickle into a stream. We may not see fully automated concepts like this, but we’ll see more automation. No question.
“Automation will be commoditized quicker than most people think. It’s happening already,” Klein said. “That being said, it’s hard for various establishments to set up automation, particularly for franchise owners, it can be cost prohibitive and retrofitting a restaurant is cost intensive. Automation in fast food will come through new restaurants versus existing restaurants.”
The timing couldn’t be better. The market is crowded and precious real estate is elusive, and we’re at record unemployment rates while minimum wages rise. Because of this–at the very least–back-of-the-house automation and modular formats will become more ubiquitous.
“QSRs have very thin margins. If you can operate in a smaller space or save on labor, it’ll translate to huge savings in the long term,” Klein said.
Still, he adds, none of these cost-savings or efficient technologies matter if the food isn’t nailed down. It is, after all, still the restaurant industry.
“Automation is just a tool, just like a Turbo Chef or a microwave is a tool. We’ll continue to see a lot of interesting applications with automation that will be exciting. We already are starting to see a lot of these types of modular kitchens being worked on,” Klein said. “But if the quality of the food and the taste isn’t there, no food business will survive.”
