I certify that this report does not incorporate without acknowledgement, any material previously submitted for a degree or diploma in any university, and to the best of my knowledge and belief it does not contain any material previously published or written by another person, except where due reference is made in text.
The food industry is an important sector in Sri Lankan economy. It consist of activities related to processing, converting, preparing, preserving, packing and distributing food and services across the country or the world.
The food industry is diversified, ranging from small, traditional, family run business with highly labor intensive to large, capital intensive and highly mechanized industrial processes.For examples Bakers, university/college dining halls, cafes, catering service, restaurant, hotels·etc. In addition, the food processing sector is essential for the overall development of the economy as it provides an essential link between agriculture and industry.
The Restaurants play important role in Sri Lankan food industry.
The restaurant is a public place, which opens to sell and distribute food and beverage to customers. In today’s busy world where leisure time has become more important. The restaurant support people to spend less time spent on preparing meal and allow more available time for leisure activities.
Today Internet and new technologies have changed the process of buying, storing, preparing and selling food in Restaurant. For example Restaurant Web site or Mobile App. People who do not have time to prepare meal at home can only just click on the Internet in order to find their local restaurant which deliver freshly prepared hot food ready to eat straight to their door with minimum time.
As well as today most of the restaurant depends on its Management Information Systems, which coordinate everything from scheduling personnel to customer service. It allows manager to determine prices and schedules, make forecasts, perform an ongoing audit of inventory and other company assets, and monitor performance. According to that it is necessary to managers and staff to familiar with computers and new technologies to take advantage.
MYMEAL OPTIONS is a chain of 30 restaurants located in Sri Lanka. The restaurant has not proper information system to compete with most of the other restaurants. Based on the situation the top-level management felt that ICT could be used to enhance the ability of MYMEAL OPTIONS to face the competition.This Report will provide evaluation of impact of internet on food industry and Information System Plan for MYMEAL OPTIONS Restaurant.
Impact of the Internet on Food Industry, Restaurant such as MYMEAL OPTIONS
The critical success factors (CSF) refers to critical areas that management must continuously monitor to ensure the performance of the organization. These factors can be identified as engagement, quality of support services, facilitation, clarity of roles and coordination.
Nowadays, e-Marketing is becoming an important CSF. It is a process of marketing a product or services over the Internet. In addition, it is a process of planning, executing, distributing promotion and pricing of products and services in a computerized and networked environment. It allows to use the Web and email to drive direct sales through e-commerce.
Today millions of people are accessing different websites by using variety of devices such as computers, laptops, tablets, smartphones· etc. The number of Internet users are increasing rapidly. According to this situation e-marketing becomes necessary requirement in every business.
The restaurant web site that engages the customer with content and services differentiates use of the Internet from other forms of marketing and create competitive advantage. The impact of a web site can be divided into informational, transactional, and relational levels. The informational level includes the information of the restaurants including services, branches, menus·etc. The Web site also provides the same information that is available through traditional marketing. The transactional level allow customer to place transaction through the internet. The relational level, restaurant crate online customer groups or communities in order to develop a relationship between restaurants and customers.
In addition, Mobile App also play a vital role in a restaurants since many ecommerce transactions happen through mobile devices. It helps restaurant owners promote their food and beverage online.
The mobile app or web apps has features such as ordering and reservations, promotions, menus, photos, and videos, social media, gift cards, restaurant locator, and nutritional information cause to increase the competition among restaurants. By effective usage of the Internet, these restaurants can be more innovative, have a faster response to environmental demands, enter to new market and be able to adopt or change to attain a competitive advantage.
Today marketing strategies and the business model in the food industry have changed due to the globally spread of internet. Customers have opportunity to buy over the internet and can make online comparisons among different food and beverages. The growth of technology provide opportunity to customers to order food and beverages at home.
With the development of Internet and Web Technologies create e-Business which is integration information and communication technology with the businesses and commercial transaction take place across the internet. This will create competition among businesses.
The following are some trends in how the internet influences each of the five forces effecting the structure of food industry.
Bargaining Power of the Customers/Buyers
The bargaining power of the buyers are very high as there are no extra cost choosing another restaurant. Today with the internet and social networks, customers are aware about the quality, prices and offers for the foods in restaurants. They compare these things and find the suitable restaurant.
Internet cause to raise the bargaining power of suppliers since it allows suppliers to interact with more customers by reducing the involvement of intervening companies. As well as suppliers can increase the prices, because of uniqueness of their product or services due to internet and new technologies. It will lock the switching cost of suppliers.
Internet and new technologies creates new substitution products and services. The high availability of substitute food cause to low switching cost. In addition, there are many substitutes foods provide consumers more choices.
The threat of new entrants is high when the low entry barriers to the food industry. For example sales force, access to channels or anything in the internet make easier new entrant to entry to the food industry.
The high number of restaurants, variety of foods, low switching cost, e-commerce and e-marketing create competition among restaurants. In addition, widely spread restaurants over the country or world and interconnected through the internet create a competition with in food industry
Today Internet of Things (IoT) in the food industry has significantly reduced the risk of foodborne illness from the spoilage of contaminated food, bacteria, viruses, toxins·etc. Different types of sensors are used to monitor the state of production, delivery time and temperature. The use of real-time temperature monitoring sensors allow restaurant to closely monitor food safety by ensuring effective management of the cold chain.
The information system always provide checklists which are used across the supply chain to assess the food safety in restaurant. The food safety refers to discipline describing handle, preparation, and storage of food in way of reduce risk of customers becoming sick from food illnesses.
In the distribution chain of the restaurant can be monitored through the help of Radio Frequency Identification (RFID) transmitters and GPS systems. It also allows restaurants to become familiar with customer preferences and better respond to market demands. As well as it also allows shippers to track the location with GPS. By collecting meaningful data, shippers can estimate performance in a number of regions and customer behavior to identify and reduce travelling distance.
Apart from that sensors help to improve quality control, product tracking, workers’ activities and real-time analysis for production. Sensors inspect the food production process in restuarant, so any inaccuracies can be corrected immediately. In addition, the sensors measure the moisture content and make it possible to optimize the production process. IoT technology makes it easy to monitor the state of all food products and send the real-time information which reduce food wastage.
Scenario planning involve with making assumptions on how the business environment will change with overtime in future.It define the critical uncertainties and develop possible scenarios to discuss impacts and responses for each. If business can predict the future, they can easily respond to with what will happen in future.
First of all it is necessary to define time frame. 7 years is the better point, where it is not too close or not too far from current year and many changes may happen in the restaurants with in that timeframe. It is a good timeframe for restaurants to upgrade legacy infrastructure, organizational structure, launch a new product and enter a new market to take competitive advantages.
To scenario planning, it is necessary to identify big shifts in society, economics, technology and politics in the future and see how it will affect the business.
The fast food restaurant that can deliver the same type, quality and taste. It has an optimized supply chain, buys large volumes of menu components and invests heavily in robotics, automation, high-tech kitchens and operational mechanisms to reduce delays, costs and errors.
Augmented and virtual reality allows customers to take food experience using each one of their senses, and it is unique to every customer.
All food will be produced just-in-time with the perfect combination of ingredients, vitamins, and even taste to suit individual preferences and body needs.
A restaurant that invested heavily in their distribution system, making it accessible and convenient to get food anytime, anywhere.
Information System Plan for MYMEAL OPTIONS
Today Information and Communication Technology (ICT) has impact on food Industry. It support core activities in restaurant. For example website and and mobile app change the way that restaurant interact with customers. The customer can order food by just one click on the food mobile app.
According to this situation, it is essential MYMEAL OPTIONS to use ICT in its business in order stay in food industry. To achieve this essential MYMEAL OPTIONS has to introduce website and mobil apps to their customers. As well as it is necessary to integrate online ecommerce site with core business functions of Restaurant Supply Chain including Accounting, Inventory Management, Human Resource Management·etc.
Food Ordering and Membership Application
The traditional membership registration in MYMEAL OPTIONS is a paper-based, labour intensive process that wastes both time and money. The proposed website and mobile app provide online membership registration for customers which is very efficient and avoid unnecessary paperwork.
The online food ordering allow customers to order food through the restaurant’s website or mobile app at any time anywhere. The process is that a registered customer chooses the restaurant based on their choice, looking at the menu items, selecting an items and finally selecting the delivery method. The payment is then administered by paying with a credit card or debit card through the app or website.
The link between back office systems and online systems improves efficiency and often leads to greater customer satisfaction. The idea is that when a customer places an order online, web store and back office deal with the sale at the same time. It is not necessary to enter data more than once. The online system accepts the order and send back the status of food preparation and delivery time to the customer while the back office records the transaction, adjusts inventory levels, generates an invoice and fills the order.
Back office systems can be manual or automated. Front office systems are focused on customers and refer to activities such as sales, marketing and customer service. Effective integration of back office systems with e-commerce improves coordination with the front office which result in better customer service and reduced duplication of effort by staff.
Having the right amount of inventory on hand is essential for restaurant cause investors and customers satisfaction. Customers want fresh products on demand and investors do not want to lock in capital in inventory. Balancing inventory is a challenge since carrying additional stocks wastes money. The solution is information system which provide real time data to plan the right level and quantity of inventory.
The inventory value which is reported in accounts book should be match with physical stock value in warehouse. To ensure financial integrity between financial value and physical stock, it is required to integrate the transactions in inventory system with back office accounting through information system. This causes to investors and government to endure the accuracy of final reports and tax returns.
The restaurant’s menu will be always in customer mobile device (smart phone, tab, laptop..etc), whether they are in office, car, home or at a party. It allows them to order food and get the delivery wherever and whenever they want. In addition, website and app inform the customer of the food quality, duration of food preparation, and when the food is ready for pick-up or the amount of time it will take for delivery.
Customers can place orders and select delivery method through the restaurant’s website or mobile app. As well as the information and communication technology allow to integrate this online ordering system with restaurant kitchen display system which display customers’ orders. According to the customer orders, chiefs prepare the foods and customer receive the notification of duration of food preparation and the amount of time it will take for delivery.
Traditional restaurant food delivery process is customer placed food order and delivery request through the telephone phone call, which took up time. Now mobile apps allow customer to order food directly to their homes, office, Universities or any location with the click of just a button.
As well as web site and mobile app allow restaurant operators/manager to assign customer orders to the free riders. They can keep track of the entire delivery process, to assess drivers’ performance and optimize routes. It helps to track staff and analyses the time it takes for orders to get delivered. In addition, the Payment is administered by paying with a credit card or debit card through the app or website.
Why MYMEAL OPTIONS should invest in Reliable Information System
To achieve high levels of profitability, it is necessary to improve the efficiency of restaurant. Information system is the one of tool can use to achieve high efficiency and productivity in restaurant operations.
Information systems can use to create new products, services and new business model in order to take competitive advantages (less cost, high profit, less substitute products·etc ).
When a restaurant provides good food and customer service, customers will become frequently customers who buy more often cause to increase revenue and profits. As well as information system provide facility to restaurant to connect with many suppliers and compare their prices, quality of product and services in order to select low cost solution with good quality.
Many managers do not receiver right information at the right time take right decision. This can increase costs and lose customers. The information provide real-time market data to managers to take right decisions.
By performing better than competitors, charging less for foods and services, responding to customers and suppliers, will increase sales and profit.
Today, most restaurants handle a mass of data that is impossible to manage manually. The manual process may has a risk of arising mistakes. The solution is setup an appropriate Information Management Strategy in Restaurant.
A well-organized information system can reduce the time spent on analyzing information from a few hours to a second and the risk of errors reduced to zero. These timely accurate information are used by managers to take business decisions.
With the availability and expansion of internet based solutions & Services, the food industry is experiencing some key transformations. It allows businesses to react, respond, manage, store, retrieve, distribute and control their new valuable asset, information. In the future, a good information system in a business will no longer be an option, it will become a mandatory in determining success.