In 2017, Arby's realized its production line was no longer working. Its menu had grown complex with the addition of new proteins and having sandwiches done in one station was creating too much crossover and opportunities for error, John Kelly, Arby's chief operating officer, said. It tested a line where everything moves from one line to an expeditor area where team members then serve guests. And it worked. Sandwich construction improved as did the overall team experience.
The pandemic only emphasized the need for more accurate and faster orders and the company continues to roll out these production lines, which can be adapted to any size restaurant, across its system.
With dining rooms closed, Arby's has been servicing 50% more cars at lunch and seeing a 50% volume increase overall with many customers completing large orders, Kelly said.
"We're not only going to be faster and more accurate at our drive-thrus, but we're going to be extremely bus[y] as well," Kelly said.
The QSR shifted labor that would have been devoted to the dining room to the drive-thru, creating more checks and balances to ensure accuracy, Kelly said. The company is also planning to place employees outdoors to take orders to optimize production speed when the weather is nice, he said.
But improving throughput and labor isn't the only way Arby's and other QSRs have been innovating at the drive-thru. The pandemic accelerated a need for digital menu boards, artificial intelligence, expanding drive-thrus into dual lanes and adding drive-thru only units where available. Many other fast food restaurants like Wendy's, Taco Bell, Del Taco, Burger King, KFC and McDonald's have also shown interest in developing many of these concepts.
Expanding drive-thru capacity
Franchisees have taken steps to adapt their operations as well. Thirty-eight percent of franchisees surveyed by TD Bank as part of its 2020 Restaurant Franchise Pulse said they added drive-thru capabilities to overcome pandemic-related restrictions, while 72% implemented enhanced delivery services/online and mobile ordering and 38% created a more limited menu.
"As far as the drive-thrus, I think the impact is going to be more ancillary," Mark Wasilefsky, head of the restaurant franchise finance group at TD Bank, said. "It's going to be continuing to modify menus to improve drive-thru times, better service and tracking those metrics."
One way brands plan to improve capacity long term is transitioning from single to double drive-thru lanes, and sometimes more if the space allows, Wasilefsky said.
McDonald's is looking to create more dual drive-thrus allowing two customers to order at the same time, Mason Smoot, chief restaurant officer for McDonald's USA, said during the company’s investor day on Nov. 9. A third drive-thru line would allow operators to service complex and large orders without slowing down the line, Joe Erlinger president of McDonald's USA, said at the same event.
KFC’s Next Generation Prototype, which it unveiled on Wednesday, focuses on pickup and delivery with one drive-thru lane for ordering onsite and another dedicated to mobile pickups, which could help create a more frictionless experience, Brian Cahoe, KFCs chief development officer, said.
"Outside of delivering to your home is the ability to drive-thru and grab your order that you’ve already paid for and we're looking at different permutations of that," Cahoe said.
That could be two different lanes that converge into one pickup point, which is pretty common among QSRs, two different pickup points or even a conveyor system to deliver the product to the customer, Cahoe said.
Arby's has dual drive-thru lanes in a small number of units throughout its system, and the standard prototype within its newest Inspire design features a 40-foot dining room with a dual drive-thru lane.
"I don’t think you'll get to the point where we’re going to have four or five different types of lanes for our restaurants because you’re simply going to have space constraints for that," Kelly said.
Expanding an existing location with a new or additional drive-thru lane is also very difficult and time consuming.
"I'm sure there are going to be plenty of franchise owners in front of their local zoning boards, talking to the landlord next door [and] trying to expand the property if ... they'd like to increase the size of their drive-thru but that's a little bit longer term," Wasilefsky said.
Many brands have rolled out new prototypes with expanded drive-thrus, but many won't be built until next year or beyond. Taco Bell will open its first Go Mobile locations during Q1 2021 that include a priority drive-thru lane for mobile orders, parking spots for curbside pickup, in-store shelves for pickups and smart kitchen technology. Burger King will build a handful of newly designed restaurants in Miami, Latin America and the Caribbean next year. These designs feature double or triple drive-thru lanes, with one model positioning the kitchen above the drive-thru lanes and delivering food via a conveyer belt.
Transforming the digital experience
While many analysts expect consumers to return to dining rooms when it is safe, the pandemic has already dramatically changed consumer behavior in ways that could be irreversible.
"[The pandemic has] really forced people to really take advantage of mobile ordering, to take advantage of off-premise sales and it's working. People are enjoying it," Wasilefsky said.
That means there will be more pressure on the drive-thru, and many chains have been turning to technology to improve the guest experience.
Many chains are already looking into digital menu boards that can also offer predictive sales and better gauge consumer behavior. Digital menus allow restaurants to be more flexible and gather data on customer ordering behaviors, Wasilefsky said.
"Data, just like many other industries, is what's driving this and the businesses that best manage, anticipate and utilize that data are really going to have a very good head start on the brands that can’t or aren't doing it," Wasilefsky said.
Arby's is starting to see opportunities to use digital menu boards, especially order confirmation boards, to help with accuracy. It also expects AI or one-to-one personalization could be added to the drive-thru in the future, but only if it works for the guest.
"I don't want to put things in that we think are kind of the next new wave or the next new idea if our guests aren't adopting those and can't quickly learn how to utilize them," Kelly said. "I think that can hurt the experience at the restaurant. So I want to make sure we move in a very pragmatic and prescriptive way."
Restaurant Brands International plans to modernize 10,000 drive-thrus across Burger King and Tim Hortons locations by mid-2022. The company plans to install 40,000 digital screens with predictive selling technology. As of September, new drive-thru menus were installed at 800 Tim Hortons and 1,500 Burger Kings.
McDonald's, which has deployed its Dynamic Yield digital menu boards across its system in the U.S. and Australia, is now testing ways for customers to identify themselves at the order point that links them directly to payment, Smoot said. This identification would take place at the drive-thru, self-ordering kiosks or at the front counter, he said. The company is also testing automated order taking, which was developed by its McD Tech Labs team, at the drive-thru, Smoot said. McDonald's established this team in 2019 after it acquired Apprente, a voice-based conversational tech company.
"We're able to greet customers in a consistent manner when they arrive, accurately take their order and thank them for visiting McDonald's," Smoot said. "Customers like it because it makes the ordering process easier and more streamlined and crew are freed up to focus on the other customer-facing activities."
Fast casuals eye the drive-thru lanes
As QSRs look to add additional lanes, redesigns or incorporate new technology, many fast casuals are eyeing real estate where they can build their own drive-thrus without having to adapt their existing restaurants.
Teriyaki Madness had a handful of locations that either featured a drive-thru originally or a pickup window that wasn't in use, Jodi Boyce, executive vice president of marketing at Teriyaki Madness said. The chain converted some of those locations to a drive-thru model, and while it took time to build sales and teach consumers about this avenue, drive-thrus are starting to capture about 20% to 25% of business in these units.
"Before we weren't even considering real estate that had drive-thru locations. We just didn't think it was possible for a concept where we made the food to order and it takes a few extra minutes," Boyce said.
But the chain is finding that limiting its menu and retraining its teams — and sometimes its customers — can make the drive-thru effective.
"So it's shifting our real estate strategy a little bit and we’re now considering locations that have drive-thrus or pickup windows," Boyce said. "If a site comes up tomorrow in a great location that has a drive-thru, we're going to jump on it."
Teriyaki Madness is also contacting restaurant concepts before they close to see if the chain can take over the lease, Boyce said.
Noodles & Company is also expanding into the drive-thru segment to accommodate mobile orders, and with good reason. One of its newest drive-thru restaurants in Wisconsin set record sales during the first seven, 14 and 21 days in operations, Dave Boennighausen, Noodles & Company CEO, said during an October earnings call with investors. Seventy-eight percent of digital orders completed at this location were processed through the drive-thru, with an average time of 62 seconds despite the high volume.
"We continue to target at least 70% of new restaurants to include the order ahead drive-thru window in their construction," he said. "These types of numbers give us greater confidence not just in a reduced square footage in general, but additionally in the potential [to] test materially cost-effective buildouts that only incorporate off-premise and/or digital sales."
Drive-thrus also hold an advantage over curbside operations, which many fast casual brands added during the pandemic. Drive-thrus have dedicated labor, whereas curbside usually requires someone to be pulled off a register.
"I think curbside is a nice ancillary for fast casual, but it’s not a solution. It won’t hold a candle to drive-thru," Wasilefsky said.
Franchisors also have a lot of data on drive-thru, including throughput measurements, accuracy, delivery time, stop time and ordering times, Wasilefsky said. Drive-thrus are tightly measured, down to the time it takes to order and handoff to customers, accuracy rates, throughput measurements, among other data points that just don’t exist for curbside, Wasilefsky said.
The vanishing dining room
With more demand coming from digital orders, restaurants are investing in ways to shrink the dining room, expand patios and accommodate third-party delivery and customer pickup, Stephen Jay, managing director and senior vice president of experience design at Big Red Rooster, said.
A 3,000-square-foot restaurant that might have originally had 1,500 square feet proposed for the dining room might instead use only 500 square feet for indoor seating to allow for more space for a drive-thru behind it or two drive-thru lanes, Wasilefsky said.
"I can certainly see dining room space being sacrificed for improving drive-thru service," Wasilefsky said.
Chipotle is considering adding smaller restaurants with a Chipotlane — potentially with a tiny dining room or no dining room at all — in between larger stores to create a convenient access point to customers, Chipotle CFO Jack Hartung said. These restaurants would help supplement larger units nearby that may not be serving customers a few miles away, he said. Chipotle opened its first Digital Kitchen in November with plans to use the model in other urban settings where a full-sized restaurant wouldn’t fit.
McDonald's is exploring an express model that would have a small or no dining room and focus on drive-thru, delivery and takeout. Del Taco, Wendy's and Arby's are all considering drive-thru only models as well.
During the first quarter next year, Arby's plans to deploy some prototypes into its system that could reduce dining rooms size or seating or create drive-thru only restaurants, Kelly said. A franchisee is building its first drive-thru only model in Texas, which is expected to be ready during the first quarter, Kelly said.
"I don't believe we're going to see [drive-thru only locations] widespread, but I do believe we're going to see a shift and some opportunistic real estate opportunities throughout the U.S. as we come through the pandemic," Kelly said.
The company can also adapt its production line into any footprint, whether that be an endcap, conversion, small dining room or drive-thru only model, Kelly said.
"There are a lot of conversations going on right now on. … What's the future of in-store dining going forward?" Wasilefsky said. "A lot of brands have spent a lot of money over the last few years re-imaging their business and re-imaging their stores. And a lot of those focus on big, beautiful dining rooms."
These newly designed buildings are seven- to 10-year assets, whether they are leaseholds or owned outright and could last a long time, Wasilefsky said.
"But more of a focus on drive-thru, takeout and delivery … which has exponentially increased over previous levels, is going to become something that sticks," Wasilefsky said.
McDonald's, for example, is still on track with its Experience of the Future remodels, which include self-order kiosks, delivery systems, extra drive-thru lanes and renovated dining rooms, and expects to have 90% of its modernization efforts completed by the end of 2021 in the U.S., executives said during the company’s investor day on Nov. 9.
Arby's, which has 3,500 restaurants with dining rooms, isn't likely to undergo any dramatic changes to its existing restaurants either.
"I don't foresee us moving forward with a 100% drive-thru only model," Kelly said. "I think that as those opportunities come up, and we see that there is an advantage to being in drive-thru only, we’ll take those opportunities. … But I don’t think I'll see it outpace our traditional prototype or even an endcap."
People are eventually going to return to dining rooms, and Arby's is confident it can capture those guests when the time comes.
"There's going to be a desire to get back to 'normal,' whatever that is," Kelly said. "Some guests may or may not have a concern, and I want to be able to ensure a delightful experience for all of those guests. And we're in a position where we can be very agile and nimble to do that."
Emma Liem Beckett contributed to this article.