According to a recent report, the global fast food and quick service restaurant market reached a value of US$ 232.3 Billion in 2021 and is expected to reach US$ 308 Billion by 2027, exhibiting a CAGR of 4.9% during 2022-2027. This significant growth is fueled by the increasing adoption of franchise business models of popular food chains, the hectic lifestyles of the average urban consumer, and the overall convenience of on-the-go food. Nevertheless, the global supply chain disruption in the present times poses a significant challenge to their growth. 

The UNEP Food Waste Index Report of 2021 states that 13% of global food waste comes from the food services industry. Many big  restaurant chain companies have pledged to adopt processes and bring in innovations to combat this food wastage problem and optimizing their supply chain is the primary focus of this cause. Also, Accurate supply chain planning which includes daily demand prediction, inventory planning, and purchase and replenishment planning is absolutely essential for the profitability of any restaurant Industry. Therefore it only makes sense that restaurant should look to acquire these capabilities

‍Enter Kronoscope: 

Fountain9’s Kronoscope is one of the most advanced AI-driven demand Sensing Inventory Planning products for companies operating in the Restaurant chain, CPG,  Retail, and E-commerce businesses. It uses overall nine different signals like historical trends, seasonal effects, and cyclicity to provide base-level demand predictions. The Baseline demand prediction is further factors in changes in pricing, promotional campaigns, and holidays or weather for a sharper, more accurate demand pattern.

Also, Kronosocpe with its sophisticated AI engine helps restaurant by automatically creating dynamic purchase plans, factoring in dynamic lead times, fill rates, shelf life, current inventory levels, open orders, and dynamic safety stock levels.

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‍5 Key Capabilities Restaurants Must Acquire

1. Demand sensing capability to predict demand at Menu item/Outlet level: Demand Sensing at the menu item level for every restaurant/commissary and converting it to the raw material levels is an essential capability restaurant must acquire. This will help in accurate inventory planning through the supply chain, thereby reducing the chances of stockouts. Moreover, this level of granularity will help in ascertaining the demand for new dish introductions. 

• Kronoscope’s Impact: Kronoscope can help restaurant to predict daily demand for their perishables with internal and external demand drivers such as promotion, day-of-the-week effects, holidays, seasonality, and waste amongst others.‍

2. Measuring The Impact Of Promotions On Demand: Restaurant Promotions Planning is a challenging task. Designing promotions to reduce food wastage while predicting demand accurately is a task that when done manually will lead to inefficiencies and out-of-stock losses.

• Kronoscope’s Impact: Kronoscope’s machine learning algorithm l learns for your historical promotions data and brings in the impact of future promotions to your demand predictions  Further, it helps identify the crossover impact of promotions on one menu item/category to other associated menu item/categories and establishes a visual correlation between the impact of promotions and demand makes it an ideal demand planning platform for restaurant.

3. Automated Purchase Planning Capability at Raw Ingredients Level: restaurant should look to automate their entire purchase planning operations. They need a solution that effectively breaks down the menu item demand to ingredient levels and assesses key factors like ingredient shelf life, number of days of inventory to buy, inventory aging, supplier MOQ, supplier fill rates, and supplier lead times to automatically build accurate purchase plans. Doing this process manually can not only be very tedious and time-consuming but also will lead to inefficiencies and stockout situations when done for thousands of outlets.

• Kronoscope’s Impact: Kronoscope helps generate daily purchase plans in just 2 clicks with real-time demand and inventory changes adjusted for shelf life, number of days of inventory to buy, inventory aging, supplier MOQ, supplier fill rates, and supplier lead times. 

4. Replenishment Planning capability at the raw ingredients level:  Like the purchase plans, automating replenishment planning makes sense for restaurants as they need to replenish across multiple restaurants/commissary with several menu items. Automating replenishment planning as per business decisions of maximizing revenue with high availability or reducing waste should be a priority. The system should be able to build plans by assessing factors like current inventory levels, the number of replenishment cycles for stores, store storage/freezer capacity, and truckload optimizations for the optimal use of working capital. Automating replenishment planning will surely help in combating food wastage and out-of-stock losses.

• Kronocope’s Impact: Kronoscope can generate daily replenishment plans in 2 clicks with real-time demand and inventory changes adjusted for ingredient shelf life, store storage/freezer capacity, truckload optimizations, and UOM batching.

5. Automated Alert Systems when Menu items and Ingredients Run Low:  restaurant is a highly service-oriented business and any cases of stockouts should be reviewed very carefully. Restaurants should implement an inventory planning system that will automatically provide alerts to the demand planners about any upcoming out-of-stock situations at any of the outlets and should suggest the number of days worth of stock left, the amount of stock required, and the value of out-of-stock losses as per the ingredient price book.  This system will provide the capability to proactively act and avoid out-of-stock losses altogether.

• Kronoscope Impact: Kronoscope inventory planning control tower provides demand planners the capability to preempt and prevent the risk of out-of-stock loss and food waste with dedicated dashboards so that you can delight your customers with the freshest products at all times.

Restaurant being a highly customer service-oriented business should focus heavily on predicting the demand for their products as accurately as possible while also ensuring that those demands are being met with the freshest products always, which is easier said than done. Manually working all this out in the modern age where the demand driver trends change daily is simply not an option. restaurant need to invest in future-ready AI/ML demand and inventory planning solutions to be ahead of the curve, profitable, and relevant.