One computer glitch can stop a retailer in its tracks
NEW YORK — A glitch that disabled registers at thousands of Starbucks stores Friday was a reminder of the invisible systems restaurants rely on to run increasingly sophisticated operations.
Registers that once merely rang up tabs and stored cash have evolved into hubs that can collect enormous volumes of data and carry out many tasks.
They process credit cards, send orders to computer screens in kitchens and help run loyalty programs. In the industry, they're called point-of-sale, or POS, systems, and vary greatly in what they can do.
The register malfunction that forced Starbucks to close stores last week was surprisingly large; it affected all company-owned stores in the U.S. and Canada, or more than 60 percent of roughly 13,500 locations.
"I have never heard of anything on a national scale like this," said Blaine Hurst, chief transformation and growth officer at Panera Bread Co.
Starbucks said the outage was the result of an "internal failure during a daily system refresh," and declined to provide further details.
Regardless of the shutdown's cause, modern-day registers have become an essential tool for helping restaurants with:
The transactions recorded through registers can give companies insight on everything from how many chicken wings were sold in a particular week to whether a new iced coffee is faring well in certain regions.
"Data is the holy grail of retail," said Craig Bahner, former chief marketing officer for Wendy's. "We always thought of the POS system as a tool to be able to get to know your customer."
Bahner noted that loyalty programs can provide another level of data by connecting purchases to specific individuals. That allows companies to better tailor promotions and offers.
Beyond helping companies understand customer tastes, sales data can help chains run tighter ships. It can let managers better predict how many beef patties they'll need in the coming week, or plan how many workers they'll need to schedule.
Restaurant chains are always shaking up their menus or dangling limited-time offers to attract customers; think of the McRib at McDonald's or the Pumpkin Spice Latte at Starbucks. That means chains need to regularly update their menus, and may have to adjust registers as well.
Earlier this month, for instance, Boston Market offered a "Buy One, Get One" promotion for Tax Day that required a special button to be programmed into registers.
Given the chaos that could ensue if registers were to malfunction, Boston Market has an "IT Lab" where it tests upgrades on about a dozen machines, said Gregory Uhing, the chain's chief financial officer, who also oversees technology.
"We try to see if we can break it," Uhing said.
The technology that companies use to program their registers varies.
For instance, Panera's Hurst said he previously reviewed a program by Micros called Simphony that updates menus and prices on registers by loading the information into a cloud. If the data in the cloud were to be wiped out for whatever reason, that would theoretically leave registers unable to function, Hurst said.
A representative for Micros, which announced Starbucks as a client for its POS system in 2011, was not available for comment.