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Deliveries And Dragontail Restaurant Roundup: Deals

Restaurant Roundup: Deals, Deliveries And Dragontail

May 28, 2021 at 10:53PM
by PYMNTS

Yum! Brands is continuing its ongoing tech acquisition spree with its purchase of Dragontail Systems Limited, a kitchen management and delivery technology company, which was announced on Wednesday (May 26).

Melbourne-based Dragontail creates software that uses artificial intelligence (AI) to streamline order management and delivery processes. Technologies include a driver dispatching system, kitchen workflow tracking tools, computer vision food prep controls and a consumer-facing order tracking feature, among others.

“With Dragontail, we expect to tap into the power of AI to accelerate and further enhance our delivery technology capabilities, especially at Pizza Hut, and optimize the end-to-end food preparation process,” Chris Turner, Yum! Brands chief financial officer, said in a statement.

The news comes in the wake of the company’s recently announced acquisition of Tictuk, a chat-based ordering and marketing platform company, and its deal to buy AI analytics firm Kvantum.

These sorts of tech investments have been paying off for the company, with Yum! Brands seeing record-high digital sales surpassing $5 billion in Q1 2021.

Under the terms of the all-cash deal, Yum! Brands will pay roughly $72 million for Dragontail. 

FAT Brands Enters Into Exclusive Deal With PepsiCo

FAT Brands Inc., the multi-brand parent company of Fatburger, Johnny Rockets and Hurricane Grill & Wings, announced on Friday (May 28) that it has established an exclusive beverage deal with PepsiCo. The soft drinks will vary by brand, with FAT Brands refining the selection based on each restaurant’s distinct brand identity.

“Our holistic partnership with FAT Brands boosts our shared ability to deliver the best and most modern consumer experiences by enhancing its restaurants’ range of delicious dishes with our breadth of beloved brands,” Hugh Roth, chief customer officer at PepsiCo’s global foodservice division, said in a statement.

While PepsiCo and FAT Brands already had a partnership at four of the restaurant company’s chains, this deal expands the partnership to all of the company’s restaurants. The announcement of the deal follows on the heels of PepsiCo noting a return to away-from-home consumption, as the vaccine rollout serves as a tailwind for the company.

United Kingdom Restaurant Delivery Company Comes to the US

Foodhub, a food delivery service that operates in markets throughout the United Kingdom, announced its forthcoming entry into the United States this week. Louisiana news outlet The Advocate reported that the third-party delivery service will aim to partner with restaurants in New Orleans, Baton Rouge and Lafayette.

“We’ve made fantastic progress in several overseas territories throughout the last year, and one of our big goals in 2021 is to develop and expand our offering in the United States, starting with Louisiana,” Foodhub Chief Executive Officer Ardian Mula told the outlet. “If you look at how fast we’ve grown in the U.K., for example, that will give you an idea of how rapidly we as a brand can develop in a new market.”

The company’s Group Chief Financial Officer Mohamed Chaudry added that the service is “one of only a few multichannel food ordering solutions that offer a zero percent commission model.”

The company chose to enter the United States via Louisiana based on similarities Foodhub has observed between the state’s restaurant market and the U.K.’s market in terms of size, population density and availability of independent restaurants with which to partner. The delivery service has been growing quickly ever since the start of the pandemic, with orders increasing 42 percent between April 2020 and April 2021.

National Restaurant Administration Calls for State Grants, Permanent Allowances

Last week, the Small Business Administration (SBA) announced the closure of the application period for aid from the federal government’s Restaurant Revitalization Fund (RRF), which allocated $28.6 billion to restaurants impacted by the coronavirus pandemic. The funds fell far short of restaurant demand, unable to meet the needs of even the underserved businesses it was meant to prioritize. Now, the National Restaurant Association is calling on state legislatures to establish their own funds for local restaurants.

On Wednesday (May 26), the association announced its Blueprint for Rebuilding, urging governors, mayors and state lawmakers to “establish a state-based restaurant grant fund” using states’ own relief funds, to make outdoor dining and open container allowances permanent, and to impose restrictions on third-party delivery services, among other requests.

“State and local lawmakers have the power to make a real difference in their local industry’s recovery,” Mike Whatley, the National Restaurant Association’s vice president for state affairs and grassroots advocacy, said in a statement. “Decisive action on this proposal would provide critical tools and opportunities for the hardest-hit restaurants struggling to find a new normal.”

He added that such grants could aid restaurants in meeting “some of our long-term obligations” and in facing the “recruitment challenge,” which the association “expect[s] will continue into our busiest months later this summer.”

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