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IBM staking claim in restaurant self-service with EMN8 partnership

The two companies have signed an agreement that will leverage EMN8's application and IBM's manufacturing, services and sales capabilities to take on the QSR segment.

September 10, 2009

Self-service greets the average consumer in countless environments — at the bank, the supermarket, the airport, the movie theater and the list goes on. But one area where it would seem to make just as much sense — the quick-service restaurant, or QSR, industry — has, for the most part, ignored the kiosk movement.

But a recently announced partnership between self-order kiosk company EMN8 and tech giant IBM might suggest an impending change to that trend. After all, self-service has quickly become ubiquitous in the retail vertical with the weight of IBM and similar companies behind it.

"We expect the pace to pick up," said Perse Faily, EMN8's chief executive. "I think you'll see a lot of pilots this coming year, you'll see some expansions."

Faily's San Diego-based company has operated in the kiosk industry since 2002 and, for most of that time, has focused exclusively on the QSR space. The company has worked with brands such as Jack in the Box and Arby's to deploy its proprietary self-order kiosk technology.

EMN8 and IBM have had what Faily calls a "nascent," reseller-type of relationship for some time, but now Big Blue will take over manufacturing of EMN8's OrderM8 4000 kiosk, as well as future technology the companies plan to develop together.

"There are two driving purposes for that," Faily said. "One is that we continue to be focused on driving cost out of the solution to make sure that we deliver the highest-value solution in the marketplace, and so they were critical in terms of hitting our cost targets, and we had set some very aggressive cost targets. Secondarily â€¦ we wanted to have a partner who could scale with us."

IBM also will put part of its sales force behind EMN8's solution, and clients now will enjoy the benefits of IBM's Total Store support strategy.

"As a young company, we've been focused on first establishing a national footprint from a services standpoint, and IBM enables us to do that," Faily said. "We also want a partner that we can actually hold accountable, as opposed to building sort of a patchwork of service providers across the country."

Dan Perlick, director of end-user services for IBM's Integrated Technology Services division, says the company's Total Store capabilities, specifically developed around the needs of deployers in the retail vertical, will provide some real benefits for operators in a high-volume, often hectic QSR setting.

"In any of those environments where you have a point-of-sale presence, it's a different type of environment, and that's why we developed the Total Store model six to eight years ago," he said. "To develop a solution focus, bring our capabilities to that environment and then have the delivery infrastructure behind it to make sure we can deliver the equipment on-time, get it enabled on-time and get it supported in a highly available environment."

Neither EMN8 nor IBM would disclose the terms of their agreement.

Why EMN8?

IBM explored several options before staking its claim in the QSR space, Perlick says, and the company came to the conclusion that EMN8's application was the "best in breed."

"From our diligence, we feel that EMN8 has the best software and application for this environment that has been vetted and tested and improved on," he said. "It provides the greatest end-user experience within the restaurant. Combine that with our infrastructure, manufacturing and services under Total Store â€¦ it just became a natural fit. Leverage their application, leverage our production and services capabilities to produce a turnkey solution for quick service or fast casual dining."

Faily and EMN8 know Perlick's comments are high praise, considering the source.

"Obviously, we're very flattered," Faily said. "We know that IBM went through an extensive process, in terms of selecting us as a partner, and from our perspective, we consider the partnership with IBM a significant milestone for our company."

EMN8 also explored other options before deciding IBM was the right fit, according to Faily.

"We both actually did some diligence in the marketplace," she said. "I think they evaluated all their alternatives, and we evaluated also alternative service providers and partners, and I think we both came to the conclusion that it was really the right match."

Future of the deal

In addition to the manufacture and sale of EMN8's flagship OrderM8 kiosk, the companies plan to develop future self-service applications. First up is incorporating EMN8's application with IBM's AnyPlace kiosk.

"One of the things that we're doing is we're actively working to align our technology roadmaps," Faily said. "One of the things that's first on the docket is actually having a next-generation kiosk with the IBM APK embedded in it. That is one of our soonest, if you will, joint products that we're going to be releasing to the marketplace."

Faily says the companies are "well on the path" of having the next-generation model complete and to expect its introduction later this year.

Beyond foodservice kiosks, though, IBM may have designs on taking EMN8's application elsewhere, and Perlick says the companies could be conducting pilots in as little as six months.

"We are looking at other avenues to leverage their application in the self-service environment, outside of the restaurant space. We're doing some market analysis and working with potentially some client on some pilots and so forth. We think their application and our kiosk capabilities and manufacturing could scale and could be replicated in other retail environments."

Though it's historically focused on the QSR segment, Faily says EMN8 is willing to follow where IBM leads.

"We'll certainly leverage IBM's capabilities to take our solution in that direction," she said. "As a company, our focus is going to remain on our QSR customers, but we're certainly open to IBM taking our solution elsewhere."

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IBM staking claim in restaurant self-service with EMN8 partnership

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