Hollis Johnson
McDonald's isn't planning to replace employees with kiosks.
The internet has been buzzing this week about reports that McDonald's will replace cashiers in 2,5000 stores with self-service kiosks.But McDonald's says is has no such plans.
It's true that the company is rolling out kiosks, which allow customers to order and pay for their food, in thousands of stores.
The touch-screen technology is meant to speed up the ordering process and give people more control over customizing their food, while reducing opportunities for human error.
Analysts expect the kiosks will help boost McDonald's sales, in part because they will help increase efficiency in restaurants.
But the kiosks aren't meant to replace workers, as some reports this week indicated with headlines like, "McDonald's hits all-time high as Wall Street cheers replacement of cashiers with kiosks" and "McDonalds Is Replacing 2,500 Human Cashiers With Digital Kiosks: Here Is Its Math."
McDonald's has repeatedly said that adding kiosks won't result in mass layoffs, but will instead move some cashiers to other parts of the restaurant where it's adding new jobs, such as table service. The burger chain reiterated that position again on Friday.
"Our CEO, Steve Easterbrook, has said on many occasions that self-order kiosks in McDonald's restaurants are not a labor replacement," a spokeswoman told Business Insider. "They provide an opportunity to transition back-of-the-house positions to more customer service roles such as concierges and table service where they are able to truly engage with guests and enhance the dining experience."
In fact, sales have increased at stores that have added the kiosks, which suggests additional labor needs are a highly plausible outcome of expanding the digital ordering technology.
McDonald's restaurants that have been remodeled for the chain's new digitally-enhanced "experience of the future" - which includes the addition of kiosks - experience a 5%-6% lift in sales in the first year after the remodel, and a 2% lift in the second year, according to Cowen analyst Andrew Charles.
For Panera Bread, one of the early adopters of digital ordering technology, kiosks have led to the kind of labor redistribution that McDonald's has referenced, as well as added labor needs.
Like McDonald's is doing now, the sandwich chain added table service since introducing digital kiosks. Now, Panera is adding delivery services to 40% of its restaurants after rolling out mobile ordering technology.
The sandwich chain announced in April that it expected to add more than 10,000 new in-cafe and delivery driver jobs by the end of 2017, as a result of the delivery service expansion.
So the nature of some McDonald's cashiers' work may change, but it likely won't result in job termination.
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