At Sansan Chicken in Manhattan’s East Village, a cashier will greet you with a wave and a smile — but he’s over 8,500 miles away. Instead of a human standing in front of you, you as a substitute see a face on a screen, video chatting from the Philippines. Brett Goldstein, an AI startup founder and owner of Launch House Venture, stumbled upon the restaurant late Saturday night when he was hungry for Japanese fried chicken. He said Assets It’s the long run of fast food.
“I had this aha feeling: ‘Okay, that makes a lot of sense,'” he said.
Goldstein shared his experiences on the chain on X. He said service was friendlier – friendlier than the common New York cashier – and while he placed his order at a self-service kiosk, the cashier stood by and checked the restaurant’s point-of-sale system in case he had any questions. After Goldstein placed his order, he had the chance to tip the distant cashier.
that is crazy
The cashier literally flies from the Philippines to New York pic.twitter.com/opAyS8AYUs
– Brett Goldstein (@thatguybg) April 6, 2024
Happy Cashier is the corporate behind the virtual cashiers, and a spokesperson confirmed that it’s hiring employees from the Philippines to video call into the restaurant.
The food was good, Goldstein said, although he paid an “insane” $20 for his chicken katsu curry. The real point of dialogue, nonetheless, was the impact that virtual cashiers could have on the fast food industry.
“Put yourself in the restaurateur’s shoes,” he said Assets. “The minimum wage is increasing. The rent goes up. Either they have to raise food prices, which can only be done to a certain extent… or they can lower costs.”
Sansan’s virtual cashiers are a part of a growing movement of restaurant automation and the adoption of technology that limits the variety of human employees in a store at any given time. It is especially popular within the fast food industry, where firms want to increase their profit margins at a time when minimum wages for these employees are being increased.
“They have a clear niche; They’re not going to revolutionize their offering,” said Daron Acemoglu, an economics professor on the Massachusetts Institute of Technology Assets. “Their brand is to provide relatively cheap food, so labor costs are more important to them.”
Saving high labor costs
According to a March note from Bank of America, labor accounts for 36% of the fee of the common restaurant, and using automation to cut back menial tasks and outsourcing labor to foreign employees may very well be a strategy to get monetary savings.
Mohammad Rahman, professor of management at Purdue University’s Mitchell E. Daniels, Jr. School of Business, said Assets that hiring virtual employees, including from the Philippines, would cost restaurants like Sansan just 10% of what they might pay on-site cashiers.
The Philippines has the biggest business process outsourcing (BPO) industry on the planet and is generating projected growth $35.4 billion in sales in 2023, in response to the Business Process Association of the Philippines. It’s been over busy 1.3 million Filipinos.
Rahman said that although an hourly wage of $3.75 – the speed for virtual cashiers at similar restaurant concepts – is a pittance for U.S. employees, it’s a big amount for employees within the Philippines. The hourly wage of US$3.75 is about US$600 per 30 days, which is similar to greater than 33,900 Philippine Pesos (PHP), which is significantly higher than the common monthly salary of Filipinos of 18,400 PHP. in response to Statista.
“Ultimately, each individual will make a decision based on that,” Rahman said. “But it is important to recognize that these technologies can also be very liberating and contribute much to the world’s struggling economies.”
But hiring cashiers to work remotely has also raised concerns. Fast-casual chain Freshii used Percy, a video calling system connected to its checkouts, back in 2022, but didn’t speak publicly in regards to the technology. A Investigation from the Toronto Star noted that it employed cashiers from Nicaragua who worked for $3.75 an hour, which quickly drew criticism, and the restaurant discontinued the service in August 2023 and attributed this to a change in ownership. Although there may be a minimum wage in Ontario $16.55Legal experts called using Percy Sound.
“It’s like any other type of outsourcing,” said employment lawyer Jonathan Pinkus Star. “When you send jobs to people in another country, your only obligation is to comply with that country’s labor standards. The fact that we have a virtual presence in Ontario doesn’t change that.”
Regardless of whether foreign employees profit or not, outsourcing this work puts fast food restaurants in a precarious position, Acemoglu said. While the fast food industry within the U.S. could also be turning to virtual employees at a time of labor shortages, these jobs could just as easily pose a threat to employees on the lookout for minimum wage jobs.
“If it displaces workers, particularly in the local labor market, from the jobs that were open to them, it would impact their livelihoods and communities,” he said.
A human touch
Virtual employees like those at Sansan hit the sweet spot of automation, Rahman argued. While they save on labor costs, they supply the troubleshooting capability and heat that fully automated self-service kiosks don’t provide.
“Customers expect better service. So if you can bring in a person who is virtually there, that person can do all of your customer service as if the server was just standing there,” he said. “As long as that experience is the same, the customer probably doesn’t care.”
Rahman said greater reliance on virtual employees might be inevitable. “What we’re seeing is just a natural evolution of the future of work,” he said.
Large language models like ChatGPT and Google Gemini could enable AI bots to take commands from humans and answer questions inside a number of years. AI drives through the corporate Presto automation has installed its services in chains like Del Taco and Checkers, although human employees still do much of the work behind the scenes.
But while Goldstein recognized the lucrative potential of greater automation in fast-food restaurants, he admitted that it felt just a little dystopian to order your fried chicken from someone on the opposite side of the world. The transition from in-person employees to virtual employees and maybe eventually to AI reduces the intangible appeal of dining in an enormous city.
“There is nothing better than human connection, humanity and personal connection. “There’s something really special about being physically present,” Goldstein said. “That’s why we live in New York City.”
