The Kiosks are Here!


McKiosk?
                                     McKiosk?

I was reading a stat this weekend that one in three working people were in a union in 1970 but only one in ten are now.  The author of the editorial used this to explain why wages have stagnated, but I took a different meaning.  Given that once a company is unionized it is virtually impossible to de-unionize it, this statistic means that we saw a lot of union jobs go away, forever.  A drive through Detroit (with your windows rolled up and at top speed, not stopping at the lights) would also show the effect of trying to force companies to pay a worker more than what the value of what he was doing was worth.  This, combined with absurd work rules (in some union car plants, you needed to continue to pay workers who sat and read the paper in a room in the plant if you didn’t have enough work for them), has chased a lot of companies out of the country or just out of business.

Now the same folks who brought us the unions and ran great American cities into the ground have their sites set on minimum wage workers.  With demands of $15 per hour wages, organizers are convincing some  misguided fast food workers (many workers wisely don’t participate because they can do the math) to protest at their place of business.  Note that the average McDonald’s worker produces about $13.50 in value for his/her company, so the company would be losing $1.50 per worker per hour if they paid $15 per hour.  Multiply that by thousands of workers, and you would see millions of dollars in losses each year.  No company could withstand that.

The solution for companies faced with rising labor costs who can’t just move out of the country as did the factories is to cut the number of workers.  Enter the ordering kiosk.  The picture above shows kiosks I found at a McDonald’s in Florida last week.  There were six kiosks setup and they were getting a lot of use by the customers without many complaints.  I went ahead and ordered at the counter (I like to support the workers, plus I would rather have a person help me with my order than go to a machine), but a lot of others chose the kiosks.  Smart phone apps are also being rolled out.  Raise costs enough and you’ll just have a cooked burger appear on a conveyor belt and you would add the toppings yourself.  The restaurant would just need to employ a couple of people to load the burgers into the hopper.  They could eliminate the need to clean by just making it a drive-thru with no table service.

People with three kids and a home should not be in these jobs.  These are jobs for teenagers and young liberal arts majors to take as a first job to learn the skills needed to get the next job and move up the ladder.  If you take these jobs away by raising the minimum wage or by protesting until McDonald’s and other employers relent, you’ll be cutting off this critical pathway to a better life that a lot of people need.  You can’t get a job without experience, and without minimum wage jobs, you can’t get experience.

So if you’re a fast food worker and want to keep your job, what can you do?  Be the best worker that ever existed.  Show up ten minutes early.  Leave your cell phone in the car and concentrate on doing your job to the best of your abilities.  Smile at the customers.  Help them with their orders.  Make suggestions for them to save a few cents by bundling items.  Provide value for your employer so that they have more business because of you.  Make customers visit your store to see you, rather than go to the place across the street with the kiosks.  In short, act like you work at Chick FilA.  Plus, don’t demand to be paid more than you create.

Got and investing question? Please send it to vtsioriginal@yahoo.com or leave in a comment.

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Disclaimer: This blog is not meant to give financial planning or tax advice. It gives general information on investment strategy, picking stocks, and generally managing money to build wealth. It is not a solicitation to buy or sell stocks or any security. Financial planning advice should be sought from a certified financial planner, which the author is not. Tax advice should be sought from a CPA. All investments involve risk and the reader as urged to consider risks carefully and seek the advice of experts if needed before investing.

What do you think?  Please leave a comment?

Contact me at vtsioriginal@yahoo.com

Follow on Twitter to get news about new articles. @SmallIvy_SI

Disclaimer: This blog is not meant to give financial planning or tax advice. It gives general information on investment strategy, picking stocks, and generally managing money to build wealth. It is not a solicitation to buy or sell stocks or any security. Financial planning advice should be sought from a certified financial planner, which the author is not. Tax advice should be sought from a CPA. All investments involve risk and the reader as urged to consider risks carefully and seek the advice of experts if needed before investing.

6 thoughts on “The Kiosks are Here!

Add yours

  1. Wow, food for thought (pun intended). I was perplexed by the fast food picketing a few months ago and wondered what the fall-out would be. Now we know … the kiosk. Demanding to be paid more than what your job monetarily produces for your company will always end in disaster.

  2. Whether unionized or not, these low-skills jobs were bound to become replaced by technology. It was only a matter of time. Why pay an hourly wage when a business can pay a one-time fee for the equipment and occasional maintenance? This is the way our society is headed due to value being placed on convenience and fast service rather than human connection.

    1. Really the cost for these kinds of system can be more than you think. You need to pay people who make considerably more than minimum wage to maintain them (people are rough on systems), may need to pay licensing fees for the system, and need to upgrade the systems every couple of years. There is also a lot of development cost upfront to develop the software. I think hiring people can come close to being near the same cost if the minimum wage isn’t too high.

      I think the biggest factor, however, is customer service. Dealing with a kiosk will never be comparable to dealing with someone who is truly great at customer service. The best will make the visit to the restaurant be better and more memorable. The adequate will take your order efficiently. Unfortunately, some (too many) people in these jobs don’t put a lot of effort in, seeing the customers as a nuisance, making people prefer to deal with a kiosk. I’m sad to have self service baggage checks at airports. I liked being able to just wonder up and tell them where I was flying and have them do the rest. I’ll be sad also when I’m scanning and bagging my own groceries and entering my own order. I’d go to a place that had service if they did a good job. Hopefully some still will.

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