Starbucks and Amazon are partnering to test a cashier-less coffee shop in Manhattan.
Since COVID-19 and the lockdown-induced recession, Starbucks closed 400 stores and pivoted toward a “pick-up” model, allowing urban customers to order and collect their drinks through a mobile app.
The coffeehouse chain is now partnering with Amazon and utilizing its “Just Walk Out” technology.
When customers enter the new store, they’ll first see a counter to pick up the drinks they preordered using the Starbucks mobile app. A digital screen hanging above the counter shows which orders are still being made by baristas.
To take advantage of the convenience of Amazon’s “Just Walk Out” technology, customers can use the palm of their hand, if they’re already registered with Amazon One. Otherwise they can use an in-store code from the Amazon app or insert their credit card. A kiosk near the entry allows customers to join Amazon One by inserting a credit card and scanning their hand.
Starbucks employees are nearby to help assist customers as they enter, although some consumers may already be familiar with the technology. Amazon already operates a handful of Go stores within Manhattan, including one just blocks away from the new cafe.
“We designed this experience to fit people’s needs as they go about their day,” explained Amazon physical retail vice president, Dilip Kumar. “Sometimes you’re in a hurry, some days you have more time.”
The push toward automation occurs as the American economy witnesses historic labor shortages.
According to the Bureau of Labor Statistics, there were 10.4 million job openings as of the last day of September — exceeding the total number of unemployed workers. Meanwhile, the number of employees quitting reached 4.4 million — indicating a labor market that heavily favors workers rather than firms.
The $1.9 trillion American Rescue Plan — signed by President Joe Biden in March — extended programs through which millions of Americans received a weekly $300 unemployment insurance payout. Surveys taken over the summer indicate that millions of recipients willingly turned down job offers to continue collecting the checks.
Beyond Starbucks and Amazon, McDonald’s is continuing to develop its cashier-less store experiences. The fast-food company partnered with IBM to automate its restaurants via artificial intelligence that can understand spoken drive-thru orders.
“In my mind, IBM is the ideal partner for McDonald’s given their expertise in building AI-powered customer care solutions and voice recognition,” McDonald’s chief executive Chris Kempczinski said during the company’s most recent earnings call.
McDonald’s previously tested the solution in ten Chicago restaurants. Earlier this year, Kempczinski predicted: “Do I think in five years from now you’re going to see a voice in the drive-thru? I do, but I don’t think that this is going to be something that happens in the next year or so.”
Smaller enterprises are also relying upon technology.
Morning Consult’s Small Business Recovery Survey — which surveyed 608 small to midsize businesses between August 5 and August 16 — found that roughly three in ten have turned to automation.
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