POS Integration Helps Travelers Pay on the Way

Read the Hudson Group case study here

POS integration helps travelers pay on the way when travel retailer Hudson News needed to seel from two systerms, NEXTEP brought them together. By Richard Slawsky - Contributing Writer - FastCasual.com

The players
NEXTEP SYSTEMS, based in Troy, Mich., provides a complete suite of integrated foodservice technology solutions for grocery stores, restaurants, casinos, airports and other high-volume foodservice venues. From self-order to point of sale to digital signage, NEXTEP provides and supports the complete integrated foodservice platform.

Hudson Group, the largest duty-paid travel retailer in North America, is a wholly owned subsidiary of international duty free travel retailer Dufry AG (DUFN) of Basel, Switzerland. The company operates some 650 Hudson News, Hudson Booksellers, cafes, specialty retail and duty free shops in 70 airports and transportation terminals in North America and additional newsstands in 12 more countries around the world. The combined Dufry/Hudson entity oversees more than 1,160 stores in 46 countries and 160 airports and terminals.

The challenge
Nearly everyone who’s been in an airport or train station in recent years is familiar with Hudson News. The company has been serving travelers since the first location opened at New York’s LaGuardia Airport in 1987. Unlike the tiny newspaper kiosks that populated airports and train stations in earlier days, Hudson News stores are brightly lit and carry hundreds of titles, encouraging travelers to browse while they wait for their connection.

Hudson News has operated locations in New York’s Penn Station for almost 25 years. Nearly 500,000 commuters pass through Penn Station daily, making it one of the world’s busiest train terminals. The station serves as a hub for Amtrak and the Metropolitan Transportation Authority’s subway, bus and Long Island Railroad systems as well as a number of privately owned transportation companies.

In May 2012, the company opened three combination Dunkin’ Donuts/Hudson News stores in the Amtrak concourses of the station. The stores are located near the Seventh and Eighth Avenue entrances and also next to the Amtrak Rotunda area. The “news café” concept allows travelers to grab their coffee, donut, magazines and snacks – all in a single space.

The stores employ 60 crew members. The Eighth Avenue store is open around the clock; one of the other location is open 20 hours a day while the third is open 18 hours a day. Because of the station’s proximity to Madison Square Garden and other New York landmarks, the stores occasionally stay open longer if business warrants.

“Dunkin’ Donuts and Hudson News are concepts that co–exist perfectly in airports and rail terminals,” said Hudson Group CEO Joe DiDomizio during a ribbon cutting event celebrating the new locations. “Teaming them up provides customers with just what they want – impeccable service, cleanliness and convenience – all under one roof.”

The company faced a number of issues when developing the concept, however. To make the idea work, patrons needed to be able to pay for both their food and reading material at the same register. The point-of-sale system used by Dunkin’ prior to opening the concepts, however, didn’t allow for the inclusion of Hudson’s more than 100,000 skus, while Hudson’s system didn’t interface with the Dunkin’ menu.

In addition, reliability and transaction speed were critical. Operating in one of the busiest transportation hubs in the world, any downtime could mean a significant loss of revenue.

“Penn Station epitomizes the daily commuter,” said Thomas Kornacki, SVP of food & beverage with Hudson Group. “You have to be quick and make it convenient for customers.”

The solution
Hudson had about 150 days before the store openings to find a POS system that could be configured to meet its unique needs.

“Hudson is a very customer-focused operation, and we wanted to offer the customer a unique experience with the news café concept,” Kornacki said. “Being able to offer them a full line of products through the Dunkin’ side of the business was important. Because the POS systems in place couldn’t handle that, we looked outside for a solution.”

To meet their needs, Hudson chose point-of-sale systems from Troy, Mich.-based NEXTEP SYSTEMS. NEXTEP POS systems feature conversational ordering, resulting in minimal training time for employees; cloud-based management reporting and database, meaning the system can be updated without having to take the terminals offline; and configurable menu flow and intelligent upsell, meaning staff can process each transaction quickly while suggesting additional items to maximize revenue.

“Being a leader in Internet-based POS systems, they had those abilities and they had a number of clients in high-volume venues similar to ours,” Kornacki said. “That gave us some comfort that they would be able to build the system and provide the service we needed in a short period of time.”

The results
Although each location originally opened with two registers, the company added an additional register to each of the two higher-volume locations. Overall, the locations process a total of about 26,000 transactions per week. Sales at two of the locations are expected to average in the range of $2 million per year, while the third will average in the range of $1 million per year.

The system allows Hudson to accept Dunkin gift cards and coupons as well as incorporate Dunkin’s national programs, giving consumers the same experience they would have at a standalone Dunkin location. The company continues to add new features to the system.

“NEXTEP certainly understood our focus and worked very diligently with us,” Kornacki said. “They have been very persistent about working with the system to ensure that it does everything we want.”

In the aftermath of Hurricane Sandy, which struck the New York area in late October 2012, the news cafes were the only businesses open in Penn Station for several days. The outlets processed several hundred transactions a day providing food to first responders.

Hudson plans to incorporate the NEXTEP POS in all future Dunkin’ Donuts news cafes. The company is in the process of opening locations in airports in Dallas/Ft. Worth, New Orleans, Philadelphia and Greenville, S.C.

“We have been very pleased with how quickly NEXTEP got this up and running,” Kornacki said. “We are committed to this relationship for the long term.”

About the sponsor: NEXTEP SYSTEMS, based in Troy, Mich., provides a complete suite of integrated foodservice tech¬nology solutions for grocery stores, restaurants, casinos, airports and other high-volume foodservice venues. From self-order to point of sale to digital signage, NEXTEP provides and supports the complete integrated foodservice platform.


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