The future of foodservice is digital. There's no denying that anymore.

Is cash dead? It’s a question being pondered around the restaurant industry. Marc Chatalas, co-owner of Cactus Restaurants, a five-unit chain in Washington, says 93–94 percent of his company’s current business is coming via credit cards. And that’s a full-service restaurant where guests aren’t at war with the clock.

Yet there’s simply no way to ignore that 6–7 percent in an industry with margins as tight as this one. “I think the premise, is cash dead, no cash is definitely not dead,” Chatalas says.

But like many restaurant operators, Chatalas wouldn’t be adverse to the alternative.

Read More: Visa declares war on cash-taking restaurants.

“We certainly are trying to find ways to remove cash from the equation,” he says. “But the goal isn’t to remove cash exactly, it’s to differentiate ourselves and provide a frictionless experience for our guests.”

Cashless restaurants are becoming more commonplace. Back in the fall, Shake Shack brought to market a kiosk-only, cashless store in New York City. Fellow fast casual Sweetgreen went cashless in 2017. Here’s a story about a Chicago pizza restaurant that’s also ditching paper.

Oracle Hospitality asked more than 15,000 consumers around the world about their use of cash and other payment methods in restaurants and other foodservice outlets. It brought to light some interesting notes. Check the full report here.

As Chatalas can attest, the survey found that there’s an appetite for cash to disappear, pretty much across the board, but it’s still breathing. A third of consumers said they believe cash will still be used in restaurants and other hospitality outlets by 2022.

“There is a cash economy even in developed markets like the U.S. Tradespeople in particular may be tipped in cash or even offer a discount for cash. If you bank it, there is a record. If you spend it at a restaurant, there is no record,” says Stuart Taylor, senior director Global Payments, Oracle Hospitality. “Offering payment flexibility also plays a critical role in overall guest satisfaction. When it comes to the use of cash, most people have access to cash as a payment method and while the data suggests that there’s an appetite for cash to disappear in the near future, guests today still expect to have the flexibility of a cash payment option. The Holy Grail for any merchant is to be able to [efficiently] take any payment offered rather than lose the sale.”

That was a sentiment echoed by Chatalas. Simply, if you say no to cash, you say no to a potential customer. Rick Tasman, the owner of Bonci Chicago, leads a cashless pizza joint by deploying a unique solution.

Tasman will take a customer’s cash, put it in his pocket, and then ring up the guest with his credit card. But is that a big-scale solution for full-service operators? Not likely, especially in the situation that the owner isn’t on the floor.

Eliminating cash appeals to Chatalas’ Cactus restaurants not just because it streamlines operations, but also because it reduces shrinkage. “From a fraud or theft perspective, it’s very easy for a restaurant to get taken advantage of by customers or employees when cash is involved,” he says. “When we start to introduce digital transactions or credit cards, the opportunity for theft nearly vanishes. That’s a major reason I think a lot of restaurants would like to move in that direction.”

Oracle’s data found that 54 percent of consumers expect to personally use cash less over the next five years. It also showed that 47 percent believe they will use mobile payment and digital wallets more. Surprisingly, Oracle discovered that age doesn’t play the heavy role you might expect it to. Forty-nine percent of the 55-plus generation said they’d use cash less compared to 55 percent of Gen X and 53 percent of pre-millennials.

“Many of us have already moved completely away from cash, even for domestic transactions with cleaning services, baby sitters, music teachers, etc. For me personally, the only time I ever think about cash is a fair or festival—and most of those are taking Square or similar these days,” Taylor says.

Another nail in cash’s future is the anonymous nature. Perhaps that’s why some consumers like using it, but it’s a one-edged sword for restaurants. Big data has become increasingly important to operators. It’s why you see so many loyalty and rewards programs popping up. Knowing your guest is understanding their frequency. And repeat visits is the lifeblood of any sustainable operation.

“Cash brings a number of challenges to food service outlets,” Taylor says. “The cost of cashing up and banking every day, the lack of personalization options [as cash is anonymous] hygiene, and theft. However, the biggest issue for food service operators is speed.”

“That’s really where we’re trying to go,” Chatalas says of collecting data. “By combining a pay-at-the table process where we’re also combining some form of a loyalty program and through that we can reduce the friction or the anxiety at the end of the transaction—that’s our major goal. We want to eliminate the guest frustration that comes when they’re ready to leave and we’re not ready to process their credit card.”

Taylor says that restaurants have a lot of room to grow in mobile payment and speed, and the data reflects that. Oracle found that 27 percent of consumers agreed that they usually opt for mobile payment in quick-service situations. Meanwhile, 47 percent say they’ll use it more over the next five years. Thirty-five percent of the 55-plus generation expects to use more mobile, too.

“Guests want to be able to pay for food and drink quickly, and cash has become one of the slower payment options thanks to the arrival of mobile payment and the simplification of EMV/Chip & PIN/contactless card processing,” Taylor says. “… However, it’s important to remember that simply installing modern payment systems isn’t the end goal; maintaining their operational effectiveness is a must.”

There’s no denying that cash is slower than mobile payment or credit-card payment. Unless you’re telling the server to keep the change, of course. Cash is also a hygiene issue, as much as people don’t want to think about it. In a restaurant, though, that’s not an option. Cash must be kept separate from those handling food.

Chatalas says credit-card payments are also more secure, although some recent security breaches, at places like Chipotle, Sonic Drive-In, and Arby’s have left some consumers checking their statements.

“When we use digital wallet we’re much more secure, at least our own liability is greatly reduced. And on the other side of it, cash presents a whole different host of concerns from counterfeiting to the expense of producing it, losing it, to having it be destroyed. On both sides you could make very strong and substantial arguments that being cashless is beneficial,” he says.

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