“Significant Savings”: How Malco Theatres Found a Labor Efficiency Blockbuster

by | Jun 9, 2022 | Case Study, Sports/Entertainment

Malco Theatres busy lobby

Balancing labor efficiency with a convenient guest experience

Taking dining options beyond concessions

Movie theater dining options have come a long way. Many cinemas now go far beyond popcorn, candy, pizza, and hot dogs to offer restaurant-quality food and drinks, giving guests “dinner and a movie” in one convenient experience. While guests love in-theater dining, it significantly increases labor. Expanded menus often require multiple employees going back and forth from the auditorium to the kitchen, then running meals from the kitchen back to the guests in the auditorium.

Increasing labor efficiency while improving convenience

Memphis-based Malco Theatres is a fourth-generation, family-owned cinema chain with more than 35 locations across Arkansas, Kentucky, Louisiana, Mississippi, Missouri and Tennessee. Previously, Malco offered in-theater dining at its luxury cinema locations that serve appetizers, salads, entrees, and desserts, as well as beer, wine, and cocktails. This service required multiple employees as servers and runners to take customers’ orders and serve their food. However, taking orders and passing food to customers created noise and disruption for other guests.

To avoid the need for employees to enter auditoriums while movies were showing, Malco Theatres next tested having guests order and pick up at the counter, using restaurant-style pagers for notifying them. When the order was ready, an employee would buzz the pager and the guest would come to the counter, get their order, and return the pager. However, this system had its own set of problems.

Senior Vice President Larry Etter said, “While the pagers are generally good, they do have some issues. They sometimes break. People forget to bring them back. And sometimes the batteries die. So, there was always this equipment issue.”

In addition, guests were sometimes slow to pick up their orders. At the Malco location in Collierville, Tennessee, general manager Adrian Tucker said, “I had to have employees stand there and wait for the customer to get the order and bring back the buzzer. And it was just a long process sometimes, because the customer wouldn’t always want to get up.”

Why Malco switched to Apex Smart Food Lockers

Etter set out to find a solution that would be easy for customers to use, while improving labor efficiency and eliminating the need for employees to hand customers their order. He had heard great feedback about Apex Smart Food Lockers from an industry colleague at Santikos Entertainment, a cinema circuit based in San Antonio, Texas.

Then Etter saw the Apex food lockers in person at an industry trade show. “I found them to fit what our processes going forward should be,” he said. He saw multiple advantages for choosing Apex lockers. “One, we’re looking for a safer, more sanitized way to deliver food to our guests, and two, we want to offer our guests a better way to receive their food items from the concession or restaurant area.”

Within a few months, the first food lockers were in place at two Malco Theatres locations, employees were trained, and customers began enjoying the convenience of contactless order pickup in less than 10 seconds.

Higher throughput for bigger crowds

According to Etter, an often-overlooked factor in movie theater dining is the large number of people that want to be served at once. “People forget that at a movie theater, you could have 1,400 seats,” he said. “When you go to a restaurant, there are maybe 120 seats and you’re serving people over a period of an hour-and-a-half to two hours. But in a movie theater, people only have 15 to 20 minutes to eat.”

On average, order “dwell times,” (the time from when the order is placed in the locker until it’s picked up) average less than six minutes, and are even lower when customers are ordering on-site. Etter continued, “If you have 1,400 people all trying to order food, that’s a massive operation. Even hotels can’t handle that kind of volume. So, this is one of the reasons we’re looking at Apex, because we need those less-than-five-minute turn times. And so far, everything has exceeded our expectations.”

On the first big movie premier weekend after the lockers were installed, the lobby was buzzing with a large, excited crowd. As expected, the Apex food lockers provided great throughput for those busy nights with minimal labor. Maurice Owens, general manager of Malco Stage Cinema in Bartlett, Tennessee, said, “It helped very well. We didn’t run out of space in the lockers, because customers are really good at coming out, picking up their order and leaving.”

Vista integration speeds implentation and training

Like many theater circuts globally, Malco Theatres use Vista point-of-sale software for it’s ticket and concession sales. The Apex food locker software is integrated with Vista, which made for a smooth transition for employees as well as simple workflows. For example, instead of manually entering an order number at the locker, they simply scan an order barcode and place the food in any compartment, then move on to their next task.

Tucker said, “When a customer places their order, the employee enters their phone number into the Vista system. The order goes to the kitchen and once it’s fulfilled, it goes to our kitchen printer, prints out a ticket, and we have a kitchen monitor also that shows the order. We show that it’s made at that point. It’s automatically entered in the Apex system, and we place the order in the locker.” The customer then gets a text that the order is ready for pickup.

Malco employee scanning order

Significant savings in movie theater labor

In the cinema industry it’s understood that in-theater dining increases labor costs, because it relies on food servers and runners to take the order from the kitchen to the customer in the auditoriums.

“Now, instead of having 10 to 12 runners, we have one runner that takes the food directly to the lockers, drops it off, then picks up the next order,” explained Etter. “We have a host or hostess nearby to assist guests who need help to scan their receipt or if they forget to close the compartment door. It actually helps us in terms of hospitality because we’re greeting people when they receive their food, and someone’s available if there happens to be a problem.”

The overall result is a big labor savings for Malco. “If you had 10 employees, times $15 an hour, times 10 hours a day, you can do the math. That’s really what it’s saving us. That’s significant.”

A tech-forward approach to food & beverage operations

Etter would like to see Malco Theatres add mobile payment options for purchases, including food service. “We’re looking to the future where we would have digital enhancements where you can use your cell phone to preorder food. If you’re in the parking lot, you could order your soda, your popcorn, your candy, your hotdog, or your pizza in advance and then when you arrive, it’s ready for you.”

He likes that Apex smart food lockers let guests use the technology they’re familiar with, their mobile phones. He also appreciates another tech feature of the food lockers, the indicator lighting in the compartments. They provide a quick visual cue for busy employees, letting them see the status of each compartment and if anything is amiss.

“Probably my favorite feature is the timer,” Etter said. “After whatever time you set as your standard, the compartment turns yellow and then it turns red when the time is up. That way, we know we don’t have food sitting out for a long time. Before, the food could sit there for 10, 15, or 20 minutes, and we really didn’t know,” he said.

Owens noted, “It helps us a lot. The green light means ‘go,’ the compartment is ready for an order. The lights also flash if the customer doesn’t push the door completely closed, which helps us, too.”

The food locker solution has been an exciting addition for theater guests, too. Tucker said, “Feedback’s been great. They love it. They think it’s really cool and modern. Everybody has their cell phone, so it’s really easy. They just pick it up, their locker pops open, and they’re excited.”

Advice to other movie theaters

Owens has this advice for other cinemas looking to add food lockers. I’d tell you to go for it. It makes things much easier, much easier for us and customers are happy with it as well,” he said.

Etter offers this advice. “I would say trust the people that know what they’re doing. The Apex people do know what they’re doing so my advice is to listen, trust, execute,” he said.

Watch this Malco case study video to see how Apex Smart Food Lockers increase labor efficiency and improve the guest experience.