- WHITE PAPERS
Legendary basketball coach John Wooden used to ingrain the fundamentals in his players' heads. He'd teach grown men how to tie their shoes before they'd even take the practice court.
"The player who learned the fundamentals of basketball is going to have a much better chance of succeeding," he once said. Such wisdom easily translates beyond the court and into business, including the restaurant business.
One of the reasons Square launched updated features to its Register point-of-sale system is so restaurant operators could spend more time focusing on the fundamentals — customer service, speed of service, order accuracy — and less time worrying about the components of their payment processing infrastructure.
Announced today, Square's newest Register features, order modifiers and custom kitchen tickets, enable merchants to quickly customize orders while keeping the line moving, and record orders more accurately while improving communication with the kitchen. The customizable kitchen tickets attach a number or customer's name to an order.
"With this, you're now dealing with one complete system. You're not messing with a bunch of systems. Many QSRs have three or four systems in their operations, one for credit card processing, kitchen ticket printing, cash register, other devices. This is just one device that pulls it all together," said Square co-founder/CEO Jack Dorsey, during a telephone interview.
Square began with Wallet a little over a year ago. The mobile payment application for consumers is now used at concepts big (including Starbucks) and small. Square added Register shortly thereafter when its client base began to grow. By adding the new features today, Dorsey said Register is now "perfect for the QSR mold" because it speeds up operations.
"We're focused a lot on speed; making sure the whole payment mechanics disappear. We want restaurants to focus on what's most meaningful — getting customers in the door and through the line," he said.
Square Register is built on hardware and operating systems that are already in use at a restaurant. The service's existing features, most of which are available on iPad, iPhone and Android devices, include:
Many of these were first introduced earlier this year as part of Square's Business in a Box launch. The new features, Dorsey says, were created to add more convenience for merchants in a fast-paced environment.
"They help operators increase order accuracy, decrease wait times and give them more time to focus on their food and their customers," he said. "In an industry where speed, accuracy and a great customer experience are essential to success, Square Register gives quick-serve restaurants tools that are powerful, intuitive and affordable."
The system is also scalable and can work for mom-and-pop restaurants, as well as multiunit operations trying to achieve more consistency throughout their IT infrastructure.
"We want to build a system that is operative for every merchant, where operators can just pop it in and it works. Today, we're adding some of those features that allow it to scale very simply. The all-in-one system can be used at the counter, in the kitchen, on the floor. It's a start," Dorsey said, adding there will be iterations.
A consistent fee
One of Register's crown jewels is its flat 2.75 percent per swipe processing fee. This fee is applicable for every size operation and every type of credit card and is one of the lowest rates in the industry, according to Dorsey.
"We spent a lot of time making sure our network was robust and that we could get the best rate. Some of that has to do with the technology, some of it had to do with our connections with the card companies and the banks," he said.
Typically when a business processes a credit/debit card, funds from swiped payments aren't deposited into its bank account for days — even as long as 30 days — after the transaction. Square Register puts that money back into the account the next day.
"A lot of restaurants that sign up for a merchant account have to wait five to 30 days to get their money from their credit card system. How do you build a business when you don't know for days how much you're spending? It could be anywhere from 2 to 10 percent and you don't find out right away? (Square) is about having the simplest and lowest solution for every merchant and allowing them to have quick access to their funds," Dorsey said.
Another benefit is Register's analytics, included in the package. This feature, Dorsey says, is especially helpful for multiunit operations where a manager can't be on site all the time.
"We didn't see a great solution for most merchants, especially for QSRs, around analytics. Operators need to know what they are selling. Why are they selling it? What happens to their business when it rains? These are things that help a business grow and a lot of folks just didn't have this simple information," Dorsey said.
Analytics are one of three ways merchants can derive an ROI from Square, he adds. The others are streamlining into one system to free up time for service, and the day-after access to funds. "That's money you can be spending to build your business," Dorsey said.
In the past year, the number of food-related businesses that use Square has almost tripled and the amount of money they process has more than quadrupled, according to the company. Dorsey wouldn't disclose which brands are exploring the Register option now that it includes features created specifically for limited-service restaurants, but he acknowledged such talks are happening.
During last week's Yum! Brands earnings call, CEO David Novak briefly mentioned his company's meetings with Square, but didn't elaborate.
"Being world class in social media, digital, is a major strategic objective of ours and last week we just spent, as a team, a couple of days visiting places like Twitter and Square, just to get totally on top of what's going on," Novak said during the call.
Although the features announced today are ideal for food-related merchants, Square is focused on adding features down the road that are compatible for all commerce industries.
Right now, Dorsey says, the focus is on the new Register offerings that merchants can use to speed things up.
"What matters to customers most is that they can get what they want immediately," he said. "Once they experience that, they want to have it again and again."
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