BARS & RESTAURANTS

In New York City, a growing number of the most popular eateries have decided to eschew reservations, opting instead to test patrons’ patience. Often couched in the cultural parlance of the city’s food scene, the trend is a stark example of the pervasive impact which local technology has on the economics of the restaurant industry.

For restaurant owners, the decision to forgo reservations is mostly economic; reservations present both an organizational challenge and a financial liability: every no-show or late arrival means one less seat filled and few dollars less in the register.

As long a customers are willing to wait, there’s little incentive for restaurant owners to book seats in advance. A first-come-first-serve model effectively passes the cost to the consumer, allowing restaurants to seat tables immediately after a customer leaves and maximize the revenue generated for each table every night.

The model draws on ideas of a changing consumer. The way we shop has gone into hyperdrive, with consumers discovering, considering, and buying in one fail swoop. A November 2013 study by Google found that of the consumers who use their mobile device to conduct research, over half want to purchase the product within an hour and another 83% want to buy it before the end of the day. Waiting, as it were, is simply not an option.

LineBuzzer.com is a two-sided network. A restaurant’s staff uses a mobile app to keep stock of its wait list, marking when new diners are seated and existing customers get up to leave. Then, in a separate mobile app, consumers scan the wait times for participating restaurants and add their names to the list. The app keeps the user updated on the wait time, and if a user misses their chance they’re simply keep in a digital queue — not a physical one.

The wait also presents a new opportunity for complimentary businesses nearby, the company could eventually build a marketing product into its platform, allowing other complementary businesses to advertise to users as the wait for their turn in line. A cocktail bar, for instance, could advertise to people as they wait for a restaurant nearby. That’s additional spending in a local economy which has traditionally remained tied up while customers were forced to wait in a physical line.