Jack in the Box hasn’t explained why it waited two years, but the frequent innovator is finally moving ahead with its kiosk ordering system. Executives told investors last week that a test of the self-service devices had been expanded to 30 of the chain’s 2,158 stores, with more locations to be identified using the test results.
Jack started tinkering with kiosks almost exactly two years ago, moving a self-ordering system into just three stores at the beginning of December 2006. Why such a long breather since then?
For one thing, executives didn’t say if the system that’s booting up for the expanded test is the same one the chain tried during rosier times.
Call me cynical, but another factor may be the tougher present-day climate, a possibility underscored by investors’ reaction to last week’s disclosure. Management broke the news during a conference call about the franchisor’s financial results for the last quarter and full fiscal year. Recent performance was good relative to the rest of the industry, but still negative, with profits declining 5% and officials warning of a further earnings retraction in the quarter underway for the company, which also franchises Qdoba fast-food restaurants.
The kiosks were mentioned during executives’ account of how they plan to counter the negative economic trend. President Linda Lang noted that orders placed via the kiosks tend to exceed the chain’s check average, an experience reported by other chains that have tried the devices.
Analysts participating in the conference call repeatedly pressed Lang and her team for more details. What operational impact did the kiosks have? (“It definitely helps with our order accuracy,” said COO Paul Schultz.) And exactly how many stores are currently offering the self-serve devices?
Another question dealt with the higher sales volumes of some newly opened Jack units. Lang’s response was not totally clear, but her comments suggested that those stores sport a kiosk as part of an updated look and layout, including a more efficient kitchen.