As two behemoths in the casual-dining sector, Applebee’s and IHOP — the two concepts housed within Dine Brands Global — were rocked by the COVID-19 pandemic. But each brand quickly adapted to the new industry conditions, and that evolution continues today as each concept looks to improve its efficiencies and labor conditions leveraging new tools and technology.
John Peyton, CEO at Dine Brands, said the shift to off-premises service was the biggest change that Applebee’s and IHOP had to make. What once made up less than 10% of sales, he said, is now around 25% of the business.
“We had to get better at packaging. We had to get better at back-of-house operations. We had to get better at getting the food from the kitchen to the third-party delivery operators. We had to get better at marketing ourselves on the third-party apps,” Peyton said. “Because we weren’t necessarily part of the takeout or delivery consideration set before COVID, and then suddenly overnight we were.”
The labor crisis brought about by the pandemic also forced Dine Brands into thinking more creatively about how to utilize both front-of-house and back-of-house staff. Peyton said both brands are operating with about 90% staffing capacity, and have been for five or six quarters in a row.
“We're beginning to think this is the new normal, that there's always going to be a gap today compared to the staffing in restaurants in the past,” he said. “And so it is incumbent upon us to think about long-term solutions to make our team members front-of-house and back-of-house more productive and more efficient if in fact restaurants will be operating with fewer team members going forward.”
Technology is paramount to that efficiency. Peyton said IHOP rolled out its first new POS system in 20 years, and Applebee’s will follow suit. The companies have enabled the mobile ordering process for guests who wish to engage that way, and Dine Brands is also introducing handheld ordering systems for wait staff.
“We know from all of our testing and piloting into servers who are working from a handheld is [they’re] able to cover more tables and therefore earn more tips,” he said. “He or she is able to sell one more drink, one more appetizer, by spending more time at the table.”
John Peyton will be speaking at CREATE: The Future of Foodservice in Denver, taking place Sept. 19-21.
Contact Sam Oches at [email protected]
