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Comment by zitterbewegung | Hacker News Reader

This seems like an overengineered problem for food. I don't get how all of the capital expense can be justified for the ever slimming margins of food production? Do they plan to scale it up? Others have mentioned pizza factories and wouldn't that be their competition? I don't get it.

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If they suss it out for one place, they can roll it out to many places. So yes scaling up is the whole idea.

Pizza factories make pizzas in batches, like 2000 times pizza Y. And they get frozen, no need for an oven.

Here you need to make X, Y and Z pizza for this order. Then just an X. Then 2 Y's and a Z. All need to be made from scratch and end up hot in a pizzabox. So quite different from the factory.

It would be interesting to hear what they think the net gain is. Some places are pretty optimised already. Little Caesars, for example, usually has only 2 or 3 workers.

The article says that can make about 10x as many pizzas as a similarly staffed pizzaria. Along with their delivery innovations, it seems like they could serve a wider area and deliver pizzas much faster, especially at peak hours. The last bit strikes me as important: I really haven't ordered much pizza since the early 00's because at peak hours it could take 20 minutes or an hour - if it was a reliable 20 minute delivery, it might be more tempting (especially if automation grants some quality improvements).

Ah, interesting. I wonder how much the longer drive hurts the quality though. I can certainly tell when my pizza sat around too long.

Pizza places need more drivers than anything.

I wonder if there's some business opportunity there. I would guess a pool of drivers that serve more than one pizza chain might be more efficient than ones assigned to a specific company. Or maybe the pizza companies have some vision to leverage their own driver networks for things other than pizza?

A multi-pizzeria network of drivers might work; they could call themselves Deliverators.

After all, like Stephenson said, when you get down to it America really only does four things very well. Music, movies, microcode, and high-speed pizza delivery.

Jamie Zawinski was just complaining about the lack of options in this market on his DNALounge blog last week.

Like Ubereats?

Well your leverage with a pizza place that already has its own drivers might be a bit different.

More like a white label offering. Which has lower margins, and requires the customers don't view their driver network as an asset.

I never understood why minimum wage labor was so expensive for fast food or pizza places, and that's pretty much what they're eliminating here.

Maybe the answer is that margins are so slim in the food business that any significant reduction in cost is bigger than it appears?

>Maybe the answer is that margins are so slim in the food business that any significant reduction in cost is bigger than it appears?

Seems so. We've got people saying labor is the biggest cost for a restaurant or pizzeria, but that necessitates asking: holy shit, how can the value-add of a fresh, hot pizza over its unprepared ingredients be so low that it's worth cutting wages to below $8/hour by robotizing the work? If pizza really takes that much value as input, why does it have so little value as output?

> We've got people saying labor is the biggest cost for a restaurant or pizzeria, but that necessitates asking: holy shit, how can the value-add of a fresh, hot pizza over its unprepared ingredients be so low that it's worth cutting wages to below $8/hour by robotizing the work?

In a competitive market, it's always worth reducing the cost of inputs. The restaurant business is generally a competitive market (it's actually a bit worse than an ideal competitive market for participants, because there are usually lots of unsustainable competitors selling below cost and losing money.)

>(it's actually a bit worse than an ideal competitive market for participants, because there are usually lots of unsustainable competitors selling below cost and losing money.)

This sounds like the problem. Shouldn't the government do something about these anticompetitive practices? I don't think a good economy involves "charities" driving the restaurant business to extinction.

There are many Walter Mittys out "playing restauranteur" and no, I don't think the government should be in the business of telling people they're bad at business and stopping them from doing it. It's not like the local restaurant of the day is going to dump food on the market in mass quantities hoping to create and exploit a monopoly later.

It's actually caused by the structure of the restaurant industry itself. Almost all restaurants, even ones that become successful in the long term, lose money for the first few years. It's not the huge restaurants trying to price smaller ones out (although I'm sure this happens), it's amateur restauranteurs trying to break into the industry.

I think you're assuming that the restaurants intend to be selling below cost. Running a restaurant is one of those businesses that everyone seems to think they can do.

A somewhat common problem on Kitchen Nightmares was owners who didn't know how much they were spending on labor or food.

> This sounds like the problem. Shouldn't the government do something about these anticompetitive practices?

You mean, government should prevent owners from subsidizing operating costs as they try to establish and scale a business? Even if government wanted to do this in general (which would destroy Silicon Valley), how would it ever enforce it against millions of local small businesses, many of whom are doing it not out of deliberate strategy but simply out of lack of business skill?

And, more importantly, how do you do it without creating barriers to entry that are themselves anticompetitive in a way which is much more consumer hostile?

They're not cutting the wage rate. They're cutting the number of hours of work demanded per unit of output.

I think one reason minimum wage labor is expensive for a business has nothing to do with the hourly wage and everything to do with turnover, showing up late and not caring about getting things done right. Robots don't get hung over or ask for overtime or time off.

I can see quite a few places from pizza to fast food where a little automation could greatly improve the quality and consistency of food.

While traveling we hit a Pizza Hut. I hadn't been to one in years and wasn't expecting much. It was shockingly good. Fast forward a few days and we foolishly gambled again and they set a new bar for low. Same chain, same ingredients, same order - the only thing different were the people. If we can replicate the people who know how to make a good pizza and replace the ones who can't - I'm all for it.

Check out all the other federal, state, and local costs associated with an employee. A $1/hr wage increase costs a business more than $1/hr.

Labor is the largest cost for a restaurant.

>> I don't get it.

$15 / hr minimum wage laws

This machine would have been designed regardless of minimum wage salary.

While that is likely true, the ROI as much faster with a 15/hr min wage. Ensuring that more and more companies automate at a faster rate, when we as a society have done nothing to address the problem this creates.

We (society) are increasing the minimum wage with out figuring out what to do with all the unemployable people that do not have the education, experience, or in some cases the talent to command a wage that high. The belief is that companies will just "eat" the added costs because they are simply greedy today and can "afford" to pay more, these types of robots prove this will not be the result and what will be the result is massive unemployment

> These types of robots prove this will not be the result and what will be the result is massive unemployment

Massive unemployment for certain jobs is unavoidable at this point. Serves no purpose to condemn workers for several decades to survive with really low salaries. If there are greater efficiencies due to automation, everyone should be participating on the value created (insert basic income theories here or other similar policies)

As for the minimum wage... what can I say. Going to 15$ doesn't seem to be the end of the world. Adjusting for inflation, current minimum wage is really on lowest value for the decade and about median for the last 60 years. Considering how much economy has expanded in 60 years, seems like a very raw deal for workers in certain sectors.

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