How Small Businesses Can Lower Costs and Upsell Smarter

Small family-run and independent restaurants face challenges across the board in terms of staff, training, and economies of scale. Lucas Liu has helped to level the playing field with easy to install, cost-effective, and simple to use kiosks. His solution is designed to support multiple languages giving immigrant business owners the ability to engage customers seamlessly. The goal to improve customer satisfaction, reduce kitchen errors, and increase ticket value.

Tim Kubiak 0:30
People change careers all the time. So how do you go from computer engineering into the restaurant business, and then frankly back into technology. So today we’re joined by Lucas, look who’s got a doctorate in Computer Engineering.

And we’re going to talk about his journey, both in academia into the restaurant business, what led him into technology and what he’s doing today. So thanks for being here.

Lucas Liu 0:55
Thank you. Thank you for the invitation.

Tim Kubiak 0:57
Pleasure. So let’s start with what drew you in to your academic area in the first place?

Lucas Liu 1:06
Yeah, is to Frank, it’s quite simple. Because I first first generation, first generation immigrants grew up in China, which is well known for, for the for the weather, science and engineering, teaching when I was a kid. So I thought I’m pretty good. So that’s how I got into engineering. And I, after digging through all those different ones, and I think Computer Engineering is the ones that really faced by talent and my passion. And that’s how I got in there. Yeah.

Tim Kubiak 1:47
So you took a little segue, though, you started a restaurant somewhere along the way.

Lucas Liu 1:53
Yeah, exactly. Because I have a bunch I want to do intrapreneurship. And when I was here, it was, you know, when I was here during the Obama administration, and he really opened up the opportunity for, for the international students. So we do see a huge wave of people coming in from China, who are looking for authentic food, because that’s what they like. And that’s, that’s how we got into the restaurant businesses. As a first entrepreneurship trial. I opened it together with some of our friends in Chicago. And that’s, that’s, that’s why we do restaurants. Yep. And are you still in the restaurant business? No, I saw that. Four years ago, together? Yeah, it was a restaurant and a bar. And the bar was a karaoke bar, which was really fun. No, I think I I am more like a technology person and restaurant even though I learned a lot being management operation. You know, all those marketing stuff. But I think I just want to continue my engineering path. Is that how you were led to start? Invite? Yes, that’s how I got into invite because after years of restaurant operations, I do see a lot of struggles, especially for the immigration like immigrant open restaurants businesses, which are allowed in the united states including Chinese open restaurant Korean restaurant, Mexican open restaurant, and people are struggling on a lot of stuff and I want to use the technology to help them improve their overall operation. That’s that’s how I got into him fine.

Tim Kubiak 3:56
Interesting. So for people who don’t have a background and please correct me if I go off base it here at all, but people that open restaurants based on their authenticity often use a different ecosystem than you see in fast food American eateries right so there’s no supply chain that I know of for nationally for Chinese restaurants or Vietnamese restaurants like there is Cisco for steak houses and McDonald’s has its own supply chain. So is that true for technology too?

Lucas Liu 4:25
Yeah. Absolutely. For for immigration operated restaurants, you know, our restaurant use a POS system, that’s mainly their technology stack around it. And for for for them, a lot of them they really, if they have a good English understanding, they will use some American brand names such as like square clover, and etc. But for people who don’t have enough English background, they will prefer their native language to POS system that’s created by local you No like, like people like us and the United States to help them. That’s a lot of people using that. So the situation is quite simple. This, you know, our the restaurant system is a tradition that we can consider that as traditional SAS service, right? It’s a service, you need a lot of development, it’s kind of hard, you need a lot of service, which is also very challenging. And b2b service, b2b sales and restaurant are fragmented. And you can see the difference between the main mainstream technology was way better than, you know, whoever providing the services to the to the immigration restaurants. So that’s, that’s one of the reasons that immigration restaurants had a very bad technology step. But there’s more reason for for for, for them struggling, but this is one of the biggest reasons

Tim Kubiak 5:59
Yeah. So explain exactly what you’ve created and how it helps solve some of those problems.

Lucas Liu 6:08
Yeah. So I my company turned a focus on self ordering technology we’re trying to make we’re trying to make the restaurant automated or their traditional register cashier to replace the labor to reduce the labor costs which was the original why I’m doing this was because for for immigration restaurants I got while I was doing restaurants, I have a lot of restaurant friends for immigrants, and we all struggle hiring people. If they open a fast food style restaurant, there are two styles festival and the tiny, the, you know, the cat, you know that with service? Talking about right? Yeah. Professor, the the cashier is actually a salesperson, right? You need in that 10 seconds, 20 seconds present, sell upsell, you know, all these but they’re not doing, frankly, they’re not doing a good job. Because they it’s very hard to hire, they hire students who have fluent English speaking, but don’t care about the food, or you have somebody who cares about food, like, oh, immigrants that don’t speak English well, so that’s why we’re changing replace change this with technology. And after the more we’re doing it, I figured not just immigrant immigrant restaurants, the American restaurant, for example, the burger shop, the hotdog shop, and taco shop, all these they have the same problem. They have shorter labor shortage recently. The minimum wage is rising. And they have bad technology stack a lot of them still they use very bad POS. And that’s I see there is even bigger opportunity in the entire restaurant business is besides the beachhead which is the immigration restaurants. So that’s where we got more and more comfortable now.

Tim Kubiak 8:13
It’s an it’s gonna be an interesting time to be in the business you’re in because there is such a shortage regardless of where in food services, right, whether it’s immigrant or whether it’s mainstream. People can’t get enough cashiers enough waiters enough cooks. Yeah, exactly.

Lucas Liu 8:29
Yeah. So COVID is a double edged sword for us, wise, dude, guys, everybody educated that you need to technology operators, and that’s instead of just something fancy, you can either have or not, it is unless otherwise you can overcome some uncertainties like pandemic, I give you example, my restaurants who use our technology before the pandemic, make even more money during the pandemic, why because the competitors are close during their during the pandemic, so they can actually sustain and make more money. And that’s something that’s that’s a fact, though, it’s unfair to a lot of restaurants which takes us back to see the data. And that’s, that’s one thing. The other the other thing is, is quite a double edged sword because it also hurts us as a restaurant technology provider because a lot of restaurant clothes, they don’t have enough budget to do upgrades and even though you provided something we couldn’t afford it right. So, so, do give us a lot of burden on the cash flow.

Tim Kubiak 9:36
So your solution interface self ordering, does it help the back end of the operation as well?

Lucas Liu 9:44
We do integration. So we are trying to integrate with is the major shoe system, which are square clover tools, which are the three major cutters are trying to be nervous and they solve other vocations and we solve the funding issues. We don’t want to create something that already while developing the market, we just want to fulfill the unfair the gap. That’s

Tim Kubiak 10:10
so and if I understand, you know, you’re walking into McDonald’s or somewhere like that, that’s essentially you’ve built that for independent restaurants, right? Yeah. And is it multilingual support? So can you order in Mandarin? And I ordered English or whatever your native languages? I’m sorry, I didn’t want to assume that.

Lucas Liu 10:34
Yeah, that is the original culture. One of the feature is byline, multiple language, family supports English and Chinese. Furthermore, bag develop, need to include Spanish and other, I would just call another language and the restaurant owner can just improve their own language in their you know, like, because it’s, it’s, it’s limited. You don’t you don’t improve the entire language. You just input the necessary phrasing there. are extra owners are able to do it. So yeah.

Tim Kubiak 11:09
Is it? I don’t want to say simplify. But can you push daily specials onto the ordering board? Is it a set menu only? How does that work for the business owner?

Lucas Liu 11:20
Yeah, it’s, it’s got a lot of management tools that exist in the market. For example, you just talked about that bill? That delay specials, right? Yeah. Which is true, right? Because customer, restaurant owners are fancy on their, on their marketing strategies. And then a promotion is one of it, you can imagine on the traditional way to manage the special is you simply tell the cashier that, hey, we’re running daily specials on on Tuesday, right? Every Tuesday, we got free Taco Tuesday, right? Tuesday, Tuesday, because pre taxes on Tuesday, and you just tell the cashier and the cashier will just give up 100% off on the qpagos on Tuesday, right? But on the chaos, you need something automated, so you need to create a strategy, which is to stay and then it’s keep Ronnie on every Tuesday. And that’s the difference. And that’s also how it helps because not everybody knows it is right. But if you have a crack, manual board layout, and a cracked presentation sheet today, it’s tempting to say, oh, here is a free, oh, here, they’re 100% off here, that’s 50% of 20% off. And then this is the regular manual, and actually a push that’s more towards the operational strategy. And that’s actually how to be more useful than just ordering board. It is a strategy mentioned board regarding your sales strategy, your marketing strategy and operations. That is very important.

Tim Kubiak 13:04
So does it do you have any statistics on does it reduce the time in the kitchen, the time for the kitchen to produce a ticket, anything like that other operational efficiencies?

Lucas Liu 13:15
Yeah, there are. So I got a lot of data. And also I compare those papers with McDonald’s data, because you know, McDonald’s IPO the company, okay, so. So there are some data, it’s very interesting, with chaos, regarding the operational efficiency and reduce 90% of the ticket errors. Why? Because customers are punching up and punching their orders on their own. So they don’t make mistakes, they double check on their own before they send the orders. Right? So it reduced 90% of the ticket errors. You know what I mean? Right, either out or about wiki, I want some bubbles in there. But when you got that actual property, you don’t see any bubbles and you will be like yeah, those are those really reduce operational efficiency and also get increased average ticket size. Why? Because customer has more time to browse the menu and the browse the things that we never discovered on the menu, which are actually some some, you know, the inspiration from from the chef’s or not, I’ve never got this covered. Because that sells strategy, right? Nobody is trying to push that. So unlike EOS, it’s, it’s so consistently pushing that out. You got this new item, you got this new modifiers which is $1 more expensive, but do you want to try? Okay, so it’s keep adding up on the on the ticket size. So those are the two things that are really gonna stand out. And also the besides that the most important thing is it’s it’s way cheaper than hiring labor’s Have you paid imagine you all of a sudden you opened up like clemmy. Open like three more registers without hiring a person. By combining with your existing register, you now have four registers, and you only pay one person. And now you can, in a rush hour, you take three times more others than just one cashier. And I have a customer who has the best, their best models before they installed the kiosk. He can only do 70,000 after the install for kiosks. He can do an average they can do 10,000. That’s because you know, they have more certainly offers and it covers more more revenue. That’s how simple it is. The ROI is amazing.

Tim Kubiak 15:50
Your that that’s a strong ROI. But it’s an interesting point, because years ago, I remember reading article where Taco Bell, right major name, was struggling with their average ticket size to your point, because their demographic at that point was you know, I think it was like 18 to 26 year old male, and they were spending four bucks on average. Now, you can’t get near a taco bell for $4. And they’ve raised their price, and nobody’s flinched. Okay. Right. So the ability to drive those other products to drive additional consideration, but not have the labor expense is huge.

Lucas Liu 16:29
Yeah, exactly. And I think Taco Bell installed kiosk A long time ago. So

Tim Kubiak 16:35
yeah, my town still doesn’t have them. It’s terrible.

Lucas Liu 16:41
Yeah, it’s a slow road, he also has his own upfront costs. And that’s, that’s really, you know, heard the a lot of restaurant who wants to do app upgrades. So I just want to mention that our pricing is very affordable, we use a lease to home model. So instead of you buy the TR, you lease a car, so it gives you the restaurant owner, or easier way to get better. Otherwise, they have to pay a lot of money to get like 30 hours. Right? Now, we don’t they just said they just pay. We our companies take the risk of restaurants not paying them. I mean, so. So we were really trying to approach.

Tim Kubiak 17:24
So you talked about the ROI, that that’s a great way for them to get in produce costs. Go straight, and start using the product. Yeah, exactly. So if I recall correctly, your business operates in four or five cities at this point. We’re all obviously Chicago. Where else are you?

Lucas Liu 17:42
Oh, we are now in like 13 different states. Yeah, we’re in the middle middle class was a huge area, Illinois, Indiana, Wisconsin, San Louis, which was a major focus, of course. And now we get a lot of users from California, New York, Florida. And what else? Texas? That’s what I’m trying to say. Yeah. Yeah. Because our Yes, we tend to make a really a plug and play device instead of a big chunk of technology, because restaurants are not really technology savvy. So they need something easy to install, plug and play. We make everything wireless, no cable at all, except the power of course. And you know, the Wi Fi. Personally Wi Fi, but we because I’m a PhD in engineering are really trying to make sure everything Wi Fi stable. Otherwise, it’s not going to work. You’re not expecting to lose connection all the time, right. So we try to make sure it’s in WiFi, stable and easy to install. That’s how we got into different states.

Tim Kubiak 19:00
Interested? I know a little bit about recal Wi Fi because I worked with a technology company called cradlepoint. A number of years back, doing SIM cards for diverse conductivity.

Lucas Liu 19:12
Yeah, yeah, that’s something we’re important. And, but that’s extra cost. If a restaurant owner cannot afford him, we have to provide some other ways to do that, you know, listening as he gets better and better. With 5g, all these new technologies, new Wi Fi protocols rolling out. Everything’s getting better.

Tim Kubiak 19:32
Yeah. The cost of 5g is coming down, right? Yeah. Yeah. In for listeners that aren’t American. Right. Internet costs here are extremely high compared to Europe, UK. Oh, yeah. We for Asia, right. But the costs here in business grade costs are way higher than consumer costs. So yeah, yeah. You know, it Yeah, I live I live in that world a little bit. So. So any final thoughts? Anything you know that you want people to know that are considering deploying your solution?

Lucas Liu 20:12
We just try. Yeah, it’s definitely worth it. Yeah, I’m, I’m a, I know a restaurant business so well, and I know how they struggle. And we’re really trying to tailor our solution towards a good, ideal, sort of make, make our restaurant owner friends, hands off, you know, after setup. That’s our goal. You know, I know how tough it is to manage a lot of differences at the same time. And I hope with our technology, the word does, that’s my goal. And if you want to worry, have less worry, your registered, charging installed on kiosk and it’s your burden. Lucas, thank

Tim Kubiak 21:01
you so much for taking the time. I appreciate you being here. Thank you.