Digital Digestion

Digital Digestion
March 2000 -- Foodservice Front

By: Bill McDowell

  How will the Internet affect the foodservice industry? Not much. Except for the way restaurants communicate with customers, suppliers and employees.

  Working for a dot-com company, I find myself fielding a lot of questions lately about how the Internet will impact foodservice. The question itself is interesting, because as little as a year ago, many operators and manufacturers dismissed the Internet as having little relevance to our decidedly "high-touch, low-tech" industry.

  More observer than expert, I believe the Internet promises to change foodservice in three main areas: how restaurants communicate with their customers, how operators recruit and train employees, and how operators communicate and trade with their suppliers.

  First, everyone needs to recognize that the real turning point hasn't yet occurred. The Internet's full potential hinges largely on the shift to high-speed, or broadband, access. Once consumers and businesses can easily access virtual restaurant tours, make real-time reservations and watch streaming video demonstrations without the hassle of a slow connection, the marketing potential for operators and manufacturers will become apparent.

  On the consumer-marketing side, the reservations and delivery markets show the most immediate potential. Sites such as OpenTable.com and RestaurantRow.com are scrambling to establish themselves as real-time, online reservations solutions. Others, such as MonkeyRules.com, are offering restaurants the opportunity to auction seats at a discount to fill tables on typically slow nights. And Food.com recently embarked on a grassroots campaign targeting college students as a potential market for online delivery services. In each of these instances, both chain and independent restaurants stand to benefit both from broader local, national and even international exposure for a minimal investment.

  Another anticipated benefit of the Internet is its ability to link distant employees within an organization and allow just-in-time training without the added time and expense of sending staff and crew to a central location. The benefits of this are significant - most corporate training costs are travel, lodging and other logistical expenses.

  But perhaps the most significant impact the Internet will have on foodservice is its ability to more closely link operators and suppliers. The opportunity for operators to research and procure products online promises to reduce overhead expenses, promote competition and allow manufacturers faster, more direct communication with their customers. But with the promise of e-commerce comes questions: How will the traditional role of distributors be affected? Which product or service categories best lend themselves to online procurement? And what real or perceived barriers must still be overcome for e-commerce to be accepted by the foodservice industry?

  These are the questions we recently posed to more than 500 executives, ranging from chain operators to manufacturers to distributors. Next month, we'll explore their responses and their implications for the industry.

  Bill McDowell is editorial director of Horsham, PA-based VerticalNet's Foodservice Central at www.foodservicecentral.com. His previous editorial experience includes stints at Chain Leader, Advertising Age and Restaurants and Institutions. McDowell holds bachelor's and master's degrees from Northwestern University's Medill School of Journalism, Evanston, IL, where he currently is an adjunct lecturer. He can be reached via e-mail at [email protected].

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