Reduce fraud by increasing friction
Amid all of the steps restaurant operators have been taking to remove friction from processes ranging from payment to staff scheduling, there is one area where friction is your friend: preventing fraud in your business. According to Kroll’s 2023 Fraud and Financial Crime Report, 69 percent of global executives and risk professionals expect financial crime risks to rise over the next year, with cybersecurity and data breaches being the biggest drivers.
The spike in digital transactions in recent years has made it easier to commit fraud – but you can take steps to minimize your risks. Bank of America’s State of the Restaurant Industry report advises restaurants to monitor anomalies in their accounts and other back-office operations, as well as take stock of areas of vulnerability. For example, note requests for refunds or payment voids, overpayment notices, digital payments that seem unusual in size or that are arriving from new sources or out of sequence, and communications that seem unusual.
You can protect your largest areas of vulnerability by incorporating some extra checks that need to happen before transactions can be processed. That can include adding verification steps on invoice receipts and matching invoices to purchase orders, for instance. When onboarding a new vendor, verify their identity and key details. When you receive an account change request, require wait times or hold payment pending verification. If you receive a payment outside of the expected cycle or if you receive a large payment amount, you can establish review protocols and use protections such as multifactor authentication to make sure the transaction is legitimate. By adding some extra friction in the form of verification checks, you can make your business a less appealing target for fraud.
Find your ideal balance of labor and tech
As summer approaches, restaurants are expected to keep adding jobs – even if the economy slows. The National Restaurant Association projects that by the end of the year, the foodservice industry workforce will grow by 500,000 jobs. This would bring industry employment back to pre-pandemic levels.
As you serve guests this summer, use it as a period to calibrate your technology-to-labor balance. The industry is at an inflection point worth watching: While brands such as Sweetgreen unveil automated makelines and other automated processes infiltrate all corners of the back of the house, we’ll begin to see patterns in how human roles in restaurants are changing – and where guests do and don’t want face-to-face help and interaction.
Will your tech provider survive?
Three years after the COVID-19 pandemic kick-started restaurant technology investment, restaurant operators are persisting in these investments to support all areas of their business. According to the National Restaurant Association’s 2023 State of the Restaurant Industry report, more than 40 percent of operators plan to ramp up investments in equipment or technology to increase productivity in both the front and back of the house this year.
But at a time when technology is the backbone supporting a restaurant’s ability to operate efficiently, restaurants need a tech provider they can trust will stick around. Restaurant Finance Monitor expects a venture capital drought to lead to a large number of restaurant tech mergers this year, so due diligence is critical. Operators will need to weigh good-value deals from newcomers to the market against the history and stability of more established players.
A new source to help restaurants navigate tech landscape
In the post-pandemic economy, it can seem like many restaurants are morphing into tech companies that also serve food. Technology is rapidly pulling restaurants into two categories: those that are embracing digital tools to bring greater efficiency and precision to all facets of their business, and those that are lumbering along with manual systems.
Restaurant leaders need to be able to make informed decisions about technology in order to not only compete today, but also to prepare their business to adapt to the new challenges it will face down the line. The Digital Restaurant Association launched recently in an effort to educate restaurant leaders about the evolving technology landscape and help foodservice businesses tap into technology to boost efficiency and profitability. It may be a resource to look to as your business considers tech investments.
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