KFC Australia operator Collins Foods eyes AI for margin improvements

Collins Foods has started trialling new AI systems in a bid to improve margins across its 296 Australian KFC restaurants.

Image credit: Collins Foods

Speaking at the company’s full-year results, managing director and chief executive Xavier Simonet said that the restaurant operator was working with the KFC’s global franchisor Yum! Brands to “optimise labour and food”.

“These are two huge cost buckets for Collins Foods, and if we can optimise labour and have the right people in the right restaurants at the right time and the same for food, that would give us an opportunity to improve our margins," Simonet said.

"A lot of work is being done in this area."

iTnews sought further detail from Collins on its plans for AI, but it did not respond in time for publication.

Earlier in the results presentation, Krystal Zugno, general manager of the company’s Australian operations, hinted that Collins was working with regional affiliates on the technology, saying it would “continue to partner with KFC (South-Pacific) to trial AI systems and tools”.

The company said it would have more to share about its plans during further upcoming investor events.

Yum! Brands, which also is also the franchisor to Taco Bell and Pizza Hut alongside KFC, has been active and vocal about its plans for AI and they resonate with Collins' statements at its results presentation.

Early last year, Yum! and Taco Bell showcased a set of AI tools for restaurant managers under the umbrella name “Byte by Yum” which formed part of a then disclosed US$1 billion ($1.58 billion) investment in digital technologies.

At an investor event in March last year Taco Bell's chief digital and technology officer Dane Mathews also revealed AI use focused on labour and inventory management.

To bring the idea for life for Wall Street investors, Taco Bell demonstrated the concept for an AI assistant Yum calls Byte AI Restaurant Coach played by a human actor.

As part of a skit the AI assistant tells a Taco Bell manager that it can replace a worker that hasn’t turned up for a drive-through shift.

Demonstrating a second use-case, the AI assistant is also shown prompting a manager to see if another staff member wants to work additional time to reduce customer wait times.

Collins Foods recently exited its arrangement with Yum! to operate Taco Bell restaurants in Australia. It closed seven stores and transferred a further 20 to Yum! Brands.