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The restaurant industry has been hit hard by soaring labor costs and inflation. According to the GMA report on restaurants during the COVID-19 pandemic, many establishments witnessed a 50% average drop in sales in December 2021 compared to 2019. Moreover, businesses reported decreasing their staff by as much as 30%. Waffle Burger, with its automated processes, is a game-changer. Without the need for traditional human resources, the company stands insulated from both the rising costs of labor and the challenges of staffing. This unique positioning not only allows Waffle Burger to maintain consistent service quality but also offers cost advantages that can be passed onto consumers. Now, as we stand at the brink of another transformative era in the restaurant industry, the spotlight is on Waffle Burger, a trailblazing autonomous restaurant setting the stage for the future. Along with its state-of-the-art autonomous delivery, the WaffleBots, Waffle Burger presents a compelling case for investment. Here’s why:
Labor Cost Efficiency:
In a recent survey by Good Morning America, it was noted that a significant number of restaurants struggled with staffing issues, leading to reduced operating hours and decreased sales. The post-pandemic world has showcased the fragility of relying heavily on human resources. Waffle Burger's autonomous model drastically reduces labor costs, making it more resilient against such unpredictable challenges.
The mandates related to COVID-19 vaccinations introduced by the Biden administration had a mixed impact on the restaurant sector. While 16% of restaurants witnessed a drop in sales and customer footfall due to the vaccine mandate, 14% saw an increase in orders and another 9% expected sales to rise. These mandates brought about fines of up to $14,000 for non-compliance, which further added to the industry's challenges. With the ongoing aftermath of the pandemic combined with rising costs and such regulatory mandates, even some renowned restaurant chains had to shut their doors.
To support the industry, federal relief measures and the Restaurant Revitalization Fund by the Small Business Administration were introduced. However, over 86% of independent restaurants and bars that missed out on this funding were on the brink of permanent closure.
Reflecting on the Past to Navigate the Future:
In the years leading up to the pandemic, restaurant bankruptcies had become a recurrent headline. The count of U.S. restaurants and bars increased at a 2.2 and 2.5 percent compounded annual growth rate (CAGR) over the three and five years preceding 2020, respectively, according to Rabobank. Put into context, roughly 45,000 new restaurants—net of permanent closures—opened across three years, more than in any other comparable period over the last 25-plus. There was an evident oversaturation, which some believed would lead to significant reductions in the number of operational restaurants. The pandemic further accelerated the challenges, with increasing rents, expensive leases, and high costs due to wage pressures. COVID-19 brought with it an uncertain number of closures, with estimates ranging between 70,000-80,000 in its initial wave.
As we moved into 2023, the industry is facing even more challenges. Despite a reduction in restaurant supply, increasing costs across the board, especially related to commodities, labor, and construction, are still significant barriers for many. The M&A space also remains in a holding pattern due to these challenges.
The landscape of 2023 indicates that while restaurants have managed to pass on some of their increased operational costs to consumers, a potential decline in foot traffic could impact revenues adversely. As the digital transformation continues to shape consumer behavior, restaurants will need to differentiate themselves either through quality or convenience to remain viable in the market.
With changing dynamics, what remains constant is the industry's resilience. Restaurants now have to navigate this multifaceted crisis, balancing the challenges of inflation, mandates, and the lingering impacts of the pandemic.
Adapting to Inflation:
The Federal Reserve's reports highlight a rise in inflation rates, impacting various sectors including the food industry. Waffle Burger's model naturally combats inflation. With fixed operational costs and a reduced dependency on fluctuating human labor costs, it is well poised to weather economic volatility.
Technological investments, such as those in autonomous vehicles and machinery, often come with tax incentives and breaks. Investing in Waffle Burger, therefore, presents a dual advantage of reducing operational costs and potential tax savings.
Supply Chain Revolution:
One of the leading causes of failure among restaurants is an inefficient or broken supply chain. As noted in many industry reports, disruptions in the supply chain have led to decreased sales and even bankruptcy. The Omicron surge emphasized the vulnerability of conventional supply chains, with 72% of restaurants experiencing sourcing challenges. Waffle Burger's solution? Owning the supply chain. This not only ensures quality and consistency but also insulates the company from external supply chain disruptions, a benefit that cannot be overstated in today's volatile market by overseeing production to delivery, Waffle Burger ensures consistency, quality, and price stability. This control is a game-changer in an industry known for its vulnerability to external supply chain factors.
Learning from Failures of Traditional Restaurants:
The recent GMA report painted a grim picture: 42% of businesses without relief grants were facing potential bankruptcy. This is a testament to the unsustainability of the traditional restaurant model in the face of challenges like pandemics. Waffle Burger, by leveraging technology, is not only more resilient but also scalable, as evidenced by the ambitious plan to open over 5000 franchises across the USA in 2024 alone.
The Power of WaffleBots:
The autonomous delivery mechanism of Waffle Burger, the WaffleBots, is not just a novelty; it’s a game-changer. In an era where contactless delivery and speed are of utmost importance, WaffleBots offer a solution that’s efficient and meets the modern consumer’s demand.
Expansion and Vision:
With plans to open over 5000 franchises in the USA alone in 2024, Waffle Burger is not just a startup; it’s a growing empire. This rapid expansion plan promises increased brand visibility, customer loyalty, and, most importantly, returns on investment.
Contrasting with Traditional Restaurants:
Despite record sales in 2022 and an exciting partnership with McDonald's, Krispy Kreme still plans to close 14 locations in 2023. These closures are more of a pruning of low-performing stores rather than signs of widespread company issues.
The chain also lost 10 units in 2022, as a result of the restaurants' inability to bring in viable profits and customer traffic. The closures seem to have the desired effect as the chain generated $1.52 billion in net revenue by the end of the year. The brand is seeing success from trying to hone in on quality over quality and still has faith in the current business model.
While traditional restaurants grapple with the issues of labor shortages, supply chain disruptions, and the constant challenge of keeping up with regulatory changes, Waffle Burger’s model bypasses these challenges. Its autonomous nature means it isn't just prepared for the future; it’s already living in it.
For investors, Waffle Burger represents a vision of the future, making it a prime investment opportunity. It offers:
Furthermore, our cutting-edge technology differentiates us from competitors by enabling efficient operations while mitigating common industry challenges. We have developed innovative solutions that address concerns such as taxes, labor laws, and mandates by streamlining processes and minimizing overhead. This not only leads to reduced operational expenses but also circumvents potential human errors, ensuring a consistent and impeccable customer experience.
Waffle Burger isn’t merely an autonomous restaurant; it's a blueprint for the future of the food service sector. Its robust model, fortified against traditional industry challenges, makes it an attractive proposition. As the world marches towards automation, Waffle Burger is already here, showing the way. By choosing to invest in Waffle Burger, you are not merely putting capital into a fast-growing food establishment but rather embracing a holistic vision for the future of restaurant operations. Investors will be presented with a unique opportunity to partake in our expansive franchise network, leveraging our brand's widespread recognition and potential for high ROI. Entrusting capital into Waffle Burger not only means participating in our present growth but also becoming a key player in the transformative future of the restaurant industry.
Since launching MSI in 2023, we are launching this small community funding round with a maximum raise amount of $50,000k .
We plan to collect interest over the next few months and then allocate investment volumes across the interested parties. During this initial phase, your payment is optional if you submit your interest in investing in this community round. Given the small community round size, we cannot guarantee that everybody will receive their desired investment amount.
The minimum investment amount in this round is $100 USD, Given the limited nature of this community round and the high interest we are seeing, we are adding a $500 maximum investment per person for now.
This a reminder that we are currently only collecting interest. If you submit a reservation, you are not required to pay any funds to reserve your investment.
Before continuing we do want to make clear that investing in any startup is highly risky and nobody should invest in this community round unless they have a high risk tolerance and are fully prepared to lose their entire investment. We will also mention that risks associated with investing in MSI company SAFE do not translate to risk of investing in MSI Inc. Under Regulation D.