Energy is the fourth largest in-store operating cost for retailers, and with record-high inflation causing prices to surge, real-time tools are necessary to help restaurants and hotels combat rising costs and focus on what really matters: customers.
The hospitality industry is no stranger to this challenge; 3-5% of total operating costsare typically spent on energy. Breaking it down further, cooking, water heating, refrigeration and lighting represent between 69-81% of total energy use in a typical restaurant.
By leveraging artificial intelligence (AI) and Internet of Things (IoT) enabled technology, restaurant owners can effectively reduce maintenance fees and fuel energy savings, unlocking a wealth of benefits. However, three specific benefits stand out above the rest.
1. Reduce rising energy costs
In the U.S. alone, commercial spaces spend almost $21 billion in energy costs, with 38% of these costs claimed by heating and cooling systems. By leveraging AI and IoT solutions, retailers and restaurants can reduce maintenance costs and realize significant energy savings across tens of thousands of locations.
AI tools can showcase prescriptive recommendations in natural language in order to help facility managers stay ahead of maintenance and address operational problems before they occur. For example, IoT and AI solutions can analyze data in real-time from multiple sources such as the equipment, weather and work done during previous technician visits.
Traditionally, energy maintenance information is provided in dashboards filled with graphs and charts, leading to facility teams becoming overwhelmed by raw data. But restaurants can remedy this challenge by implementing easy-to-use AI technology that uncovers developing problems and identifies corrective actions in plain language, so users can easily understand what needs to be done. Users simply read the recommendation and then use the platform itself to prioritize and plan actions across the retailer’s building network.
2. Meet growing consumer demand for sustainability
A recent National Retail Federation and IBM Institute survey found that nearly 80% of consumers report sustainability is importantto them, and the COVID-19 pandemic has only accelerated the Environmental, Social and Governance (ESG) agenda.
In order to meet growing consumer demand for sustainability, retailers and restaurants can adopt AI technology to achieve a number of sustainability goals, such as reducing greenhouse gas emissions, avoiding CO2 emissions and decreasing natural gas consumption.
Energy sustainability is no longer a want, but an inevitable need. Sustainability is economically good for business too, because energy reduction has a financial reward of reducing bills. So, savings are driven by the achievement of carbon goals while eliminating waste and improving the bottom line.
3. Enhance guest comfort with “healthy buildings” amid COVID-19
Ensuring comfort while keeping energy consumption and maintenance costs low has been a significant challenge amid the COVID-19 pandemic.
Health and safety guidelines by the Centers for Disease Control stress maintaining the air quality within premises as a critical requirementto combat the spread of the COVID-19 virus. Extra cooling may be required to offset some potential discomforts from wearing masks indoors, which means that the air-handling equipment must work harder, consuming more energy and becoming more susceptible to breakdowns. Extended lockdowns interrupted operations and caused many retailers to miss vital preventative maintenance cycles of HVAC equipment, affecting performance and causing outages.
The guidelines also say that stores should keep their doors open to let fresh air in as a health and safety measure. However, during peak summer, hot air from the outside sometimes didn’t allow for open windows and doors, as it would negatively impact occupant comfort. High temperatures can also negatively impact equipment health, with higher loads beyond the peak working capacity. The likely outcome is a higher number of breakdowns and eventual system failures.
By engaging with IoT-based energy management solutions to make their buildings healthier, retailers can effectively improve occupant comfort, satisfaction and even retention.
Paving the way for an energy-efficient future
As we move toward a more predictive, proactive and agile world, retailers and restaurants must react accordingly. By adopting IoT-powered technology, they can successfully drive energy savings, fuel a more sustainable world and improve the in-store customer experience.