Restaurant industry gets taste for IoT

With rising food and labour costs straining profits in an industry where margins are carpaccio thin, restaurant leaders are prioritising technology investments, in particular the internet of things (IoT).

IoT tech is seeing increased use and paying dividends, fuelling operational efficiency, improving front-of-house guest experiences and reducing downtime in the kitchen, according to research from MachineQ.

The 2026 restaurant readiness: ops meets tech report, conducted by independent research firm Censuswide, took the opinion of more than 400 US-based quick service and fast casual restaurant leaders about the effects of technology in their industry, highlighting how technology adoption is transforming day-to-day restaurant operations.

As restaurants adapt to inflation, staffing shortages and tighter margins, the report underscored a growing focus on futureproofing operations. From predictive maintenance and temperature monitoring to waste reduction and sustainability tracking, operators see technology as key to maintaining safety, efficiency and profitability in a competitive industry.

The survey revealed that back-of-house (BOH) technology plays a crucial role in strengthening both BOH and front-of-house (FOH) performance, ultimately improving profitability and shaping how restaurants prepare for future scale and resilience.

It added that while customers rarely see what happens behind the scenes, they experience the consequences of BOH inefficiencies firsthand. These challenges are driving restaurant operations teams to invest in BOH technologies, such as IoT, artificial intelligence (AI) and machine learning (ML) to help deliver real-time insights and automation.

Among the study’s topline findings were that operators identified food safety, supply chain reliability and waste reduction as the top BOH improvements that most directly enhance FOH performance.

More than half of the respondents (58%) said they see the opportunity to benefit from technology and automation, with that number climbing to nearly 70% among those operating 50 or more restaurant locations.

Nearly half (49%) of respondents experienced unplanned equipment downtime due to equipment failure or unplanned maintenance, and almost a quarter of respondents estimated revenue loss between $1,001 to $5,000 per hour of disruption.

Almost two-thirds of 63% of respondents believe real-time visibility into energy and equipment usage would help to reduce costs and support sustainability initiatives. In addition, almost half (46%) of those surveyed plan to increase technology budgets in the year ahead – outpacing planned spending increases for staffing, equipment and menu expansion.

Nearly nine in 10 (86%) are already investing or plan to invest in IoT-based systems in the next two years to improve monitoring, automate compliance and streamline multi-location management. IoT-based monitoring and automation offer both short-term and long-term efficiency, helping businesses to gain organisational clarity to better manage their time and money.

While only 14% of restaurants surveyed use IoT-based automated systems to monitor cold storage temperatures, they had the highest confidence levels that tasks were being completed the way they should.

The report also showed that automating BOH functions – such as equipment monitoring, food safety tracking and inventory management – were helping operators to reduce waste and downtime, as well as improve their businesses, thereby helping to deliver a better guest experience.

“Restaurants today are operating in one of the toughest cost environments we’ve seen, with the average annual spend for labour and perishable food per restaurant location alone exceeding one million,” said Tom Woodbury, restaurant technology lead at MachineQ. “Back-of-house automation is proving to be a critical lever – not just to help operators prevent costly downtime, but to help improve food safety, reduce waste and give staff more time to focus on customers.”