Innovations coming; but don't worry: Portillo's won't mess with drive-through
An efficiency expert might have a bone to pick with Portillo's.
Consider that each food order is still written in pencil on the back of a white paper bag, a throwback to the days founder Dick Portillo ran his first hot dog stand out of a trailer.
The manpower devoted to the outdoor drive-through line means that at the busiest times, up to nine workers are involved in ordering, cooking and delivering the food. Other fast food outlets constantly strive to reduce the number of workers involved in the process.
And unlike other chains, which precook some menu items, each Portillo's beef sandwich, hot dog, hamburger is made from scratch.
Perhaps it could achieve greater efficiencies, but Portillo's has no plans to mess with the old family recipe.
"All the systems we have in place -- the hieroglyphics on the bags, the deep manpower, the cook-to-order food -- is what has made us successful," said Keith Kinsey, CEO of the Oak Brook-based restaurant company. "We're not about to change."
It's hard to argue with Portillo's success. Each of the chain's 44 restaurants averages $7 million to $8 million in annual sales, according to the company. By comparison, the typical McDonald's takes in $2.5 million a year, according to QSR, a trade magazine covering the fast food industry.
So Portillo's can afford to be a little old school, retaining the handwritten ordering system and a drive-through line heavily reliant on manpower.
It may not be how other companies would design their supply chain management systems, but it works.
"If I were doing a new drive-through concept, I'm fairly confident that I'd have no more than two people out there. Portillo's, however, hasn't gone that route … because it continues to work well for them," said Andy Freivogel, founder of Science LLC, a Chicago-based retail consulting firm.
Still, it wouldn't be fair to call Dick Portillo a Luddite, afraid to embrace technology. Since selling Portillo's in 2014 to Berkshire Partners for an estimated $1 billion, he continues to help guide the company, although CEO Kinsey has assumed the day-to-day operating duties.
Portillo and Kinsey have expanded Portillo's suburban Chicago empire to Arizona, California, Florida, Indiana and Wisconsin, with plans to open more restaurants in the coming years.
Its future plans include more technological innovations, such as the recent introduction of a mobile app for iPhone and Android devices. Customers can place a food order using the app and either pick it up in the drive-through or inside at the Portillo's catering station.
"I think millennials, if they could do anything by phone, they would," Kinsey joked. "The app is trying to target that audience.
"The bottom line is, whether you come inside, go through the drive-through or use the app, we want to make ordering from us convenient, accurate and fast," Kinsey said.
Even the app is true to Portillo's roots. Olo, a New York-based mobile ordering company, created the Portillo's app with the same ordering system that is used on the white paper bags. So if a customer used the mobile app to order a hot dog with everything, large fries and a cake shake, it's printed out using the same symbols -- E, LF, CCS -- written on the bags. The order is printed on a sticker that is slapped on a white bag, which moves down the assembly line as the order if filled.
"Every Portillo's employee knows our unique symbols and codes, so it was important that we integrated that into the app," said Nick Scarpino, Portillo's vice president of marketing and public relations. "Olo was great in helping translate the bag codes on the app."
So it is the combination of something old, something new that is the foundation of the Portillo's supply chain.
The magic of the Portillo's ordering system is most easily understood when customers order inside the restaurant. On a recent afternoon at the Portillo's in Arlington Heights, customers queued up to talk to cashiers, who wrote down each order on white paper bags, and also used a microphone to announce the orders over a loudspeaker.
"The cooks are only listening to the speakers to know they have to get a beef or a hot dog or drop a burger on the grill. The bag is still the primary tool to tell them how to prepare the order," explained, Harry Decker, general manager of the Portillo's in Arlington Heights.
Besides the unique food codes, items are placed in specific locations on the bags. Beef sandwiches, hot dogs and hamburgers go in the top left corner, as those items are earliest on the assembly line. Fries are on the left just above the crease of the bag, as the fry station is later in the line. Salad orders are written in the top right corner. Drinks, shakes and desserts are below the fold.
"As that bag moves down the line, the items are placed inside with an idea of delivering it as fresh as possible. That's why the fries are last, because we want them hot," Kinsey said.
The system becomes even more elaborate in the drive-through, with a battalion of employees armed with headsets and computer tablets at the ready to streamline the ordering process.
When a vehicle pulls into the drive-through, the driver is first greeted by an employee who calls in the order on a headset, and affixes an order number to the car's windshield wiper. The person inside is recording the order and sending it down the line.
As the drive-through line moves forward, the driver then encounters an employee with a tablet, who confirms the order and takes payment either by cash or credit card. Inside, cooks are assembling the beef sandwiches, hot dogs, burgers, salads and other items as the bag moves down the line.
As the driver nears the final stage, a food runner brings the bag to the car, once again confirming the order.
Erick Gonzalez, 30, who has worked five years as an order taker at the Arlington Heights Portillo's, said customers are looking for fast, accurate service in the drive-through.
"If you see a line of 10 cars at another place, you'll drive by. If you see that at Portillo's, you'll drive in because you know it will be fast," Gonzalez said.
"The system is designed to make it fast and to make sure the order is right," he said.
At a time when most fast food chains are trying to limit the customer interactions to two or three employees per order, the Portillo's system is a nostalgic nod to the '50s drive-in, said Freivogel, the restaurant analyst.
"I think the team of Portillo's employees out in front of the store, guiding drivers through the line, putting the paper number under their windshield wiper, radioing in their order, and getting their change, etc., … delivers a sense of continuity and history," Freivogel said, "as well as the warmth of dealing with another human being instead of keeping oneself hermetically sealed in that automobile."