The world of automation
Jun 10th 2016, 12:35 am
#16
Lost in BE Cyberspace
Joined: Dec 2010
Posts: 14,040
Re: The world of automation
Nah. Stop and stand back. In particular, thing of one time and recurring costs.
If you are OKing the business case for throwing out all the burger flippers and making the restaurants automated, you are going to want to see that the bottom line is better, in an obvious way. You look at the cost of making those restaurants automated (a 1 time cost), the maintenance (ongoing), the loss/gain in customers (from a pilot or two), and the change in wages and personnel costs (ongoing). It has to make economic sense if it's to happen.
Upshot is it will have to noticeably save money if they are to go ahead.
Which, practically, either means the land taken up is less (unlikely), the materials used are less (nope), or more likely, the human resources bill is much lower. So, in net terms there will not be more jobs, rather there will be many less.
A few facts. There are 760,000 FTE McD employees worldwide, or 1.9m people (part time most) - 90,000 in Australia alone. There are 36,000 restaurants globally (which means ~53 people per restaurant) In Australia they spend $40m annually just on training the burger flippers.
Here's what the cost structure looks like for a typical fast food franchisee :
https://marketrealist.imgix.net/uplo...ax&auto=format
So corporate and materials rakes off a big chunk, but wages and then other associated costs (other will include personnel items) is the next biggest cost. Look at the that profit line. Now imagine what happens if 53 people is reduced to 10...
As for more jobs in farming, nope, not a chance. In fact I'd probably bet that even now McDs are researching lab grown meat.
If you are OKing the business case for throwing out all the burger flippers and making the restaurants automated, you are going to want to see that the bottom line is better, in an obvious way. You look at the cost of making those restaurants automated (a 1 time cost), the maintenance (ongoing), the loss/gain in customers (from a pilot or two), and the change in wages and personnel costs (ongoing). It has to make economic sense if it's to happen.
Upshot is it will have to noticeably save money if they are to go ahead.
Which, practically, either means the land taken up is less (unlikely), the materials used are less (nope), or more likely, the human resources bill is much lower. So, in net terms there will not be more jobs, rather there will be many less.
A few facts. There are 760,000 FTE McD employees worldwide, or 1.9m people (part time most) - 90,000 in Australia alone. There are 36,000 restaurants globally (which means ~53 people per restaurant) In Australia they spend $40m annually just on training the burger flippers.
Here's what the cost structure looks like for a typical fast food franchisee :
https://marketrealist.imgix.net/uplo...ax&auto=format
So corporate and materials rakes off a big chunk, but wages and then other associated costs (other will include personnel items) is the next biggest cost. Look at the that profit line. Now imagine what happens if 53 people is reduced to 10...
As for more jobs in farming, nope, not a chance. In fact I'd probably bet that even now McDs are researching lab grown meat.
And there's more jobs in the labs that grow the beef. Again volume production.
Jun 10th 2016, 12:36 am
#17
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Jun 10th 2016, 12:46 am
#18
snɐןɔ ʎʇıuɐs
Joined: Nov 2006
Posts: 6,558
Re: The world of automation
The purchase, wage, utility, and probably a fair amount of 'other' are all variable costs. As sales go up, they go up, if you do nothing else. If you were somehow able to increase sales by 20% without increasing the marketing budget, you would still only see a small uptick in the profit line as you needed to give more to McD central of prepackaged burgers, employ more staff, etc.
Whereas if you chopped that 24% down to 4% ....
Jun 10th 2016, 5:04 am
#19
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Re: The world of automation
For every economist saying that technological unemployment is here to stay, there's another saying that it's temporary - as it's always been
Choose your economic 'experts' wisely
Choose your economic 'experts' wisely
Jun 10th 2016, 8:08 am
#20
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Re: The world of automation
Drone delivery?
Yes, it will happen but not for a while yet
Amazon operates about 90 warehouses in the US - they would at least need to triple that number to support drones (although they could probably be smaller). Add Fedex, Best Buy, Walmart, USPS, Nordstrom etc and that's a whole lot of warehouses and infrastructure that's going to be needed to be built and maintained - and that's just in the US
Drones are okay for delivering a mobile phone, a pizza, a book, maybe even a 1.5kg bottle of champagne, a document, but a 13kg slab of beer? 30kgs of groceries? No way
Weather?
Are drones going to be zipping around a high density city like Manhattan, Hong Kong, Tokyo?
And then localised 3D printing comes along and those facilities that serve a city can be scaled down to serve a suburb - or even a street - and then individual homes - all has to be built and maintained
Seems to me that developing nations have a lot to lose - why build a factory in China, employing 10k, making tablets, when you can have one down the road employing 3
I would like to see a robot wire up one of our chlorination buildings - or service a turbidity analyser
Modern western service based economies will do okay - as long as skills and education keep pace - which is definitely not happening at the moment in Australia, UK, US etc, but that can change
Yes, it will happen but not for a while yet
Amazon operates about 90 warehouses in the US - they would at least need to triple that number to support drones (although they could probably be smaller). Add Fedex, Best Buy, Walmart, USPS, Nordstrom etc and that's a whole lot of warehouses and infrastructure that's going to be needed to be built and maintained - and that's just in the US
Drones are okay for delivering a mobile phone, a pizza, a book, maybe even a 1.5kg bottle of champagne, a document, but a 13kg slab of beer? 30kgs of groceries? No way
Weather?
Are drones going to be zipping around a high density city like Manhattan, Hong Kong, Tokyo?
And then localised 3D printing comes along and those facilities that serve a city can be scaled down to serve a suburb - or even a street - and then individual homes - all has to be built and maintained
Seems to me that developing nations have a lot to lose - why build a factory in China, employing 10k, making tablets, when you can have one down the road employing 3
I would like to see a robot wire up one of our chlorination buildings - or service a turbidity analyser
Modern western service based economies will do okay - as long as skills and education keep pace - which is definitely not happening at the moment in Australia, UK, US etc, but that can change
Last edited by Amazulu; Jun 10th 2016 at 10:00 am.
Jun 10th 2016, 9:09 am
#21
snɐןɔ ʎʇıuɐs
Joined: Nov 2006
Posts: 6,558
Re: The world of automation
Looks like Amazon are moving into groceries in the UK now, after having done it in the US for a while.
Amazon launches full online supermarket service in UK - BBC News
I kind of wonder if the idea of the 'weekly' shop mightn't disappear if drones really go forward. You can see the synergy between drone delivery of fresh food, etc. as needed, and the delivery of fast food such as pizzas, burgers, etc. also as needed. That's particularly true if the fast food cooking service gets automated itself.
Not sure how the finances go, but swapping out expensive large stores for cheap industrial estate warehouses might fund the drone delivery element - so you say "I'll have spag bol tonight" and either the ingredients get delivered by drone, or a ready cooked meal.
Amazon launches full online supermarket service in UK - BBC News
I kind of wonder if the idea of the 'weekly' shop mightn't disappear if drones really go forward. You can see the synergy between drone delivery of fresh food, etc. as needed, and the delivery of fast food such as pizzas, burgers, etc. also as needed. That's particularly true if the fast food cooking service gets automated itself.
Not sure how the finances go, but swapping out expensive large stores for cheap industrial estate warehouses might fund the drone delivery element - so you say "I'll have spag bol tonight" and either the ingredients get delivered by drone, or a ready cooked meal.
Jun 10th 2016, 9:18 am
#22
Lost in BE Cyberspace
Joined: Feb 2013
Posts: 6,148
Re: The world of automation
. And even if they are researching, that's still more jobs 
. Fact is that people will always have to eat and smart farming might become the norm, but you still have more jobs than before.
Jun 10th 2016, 9:24 am
#23
Lost in BE Cyberspace
Joined: Feb 2013
Posts: 6,148
Re: The world of automation
Looks like Amazon are moving into groceries in the UK now, after having done it in the US for a while.
Amazon launches full online supermarket service in UK - BBC News
I kind of wonder if the idea of the 'weekly' shop mightn't disappear if drones really go forward. You can see the synergy between drone delivery of fresh food, etc. as needed, and the delivery of fast food such as pizzas, burgers, etc. also as needed. That's particularly true if the fast food cooking service gets automated itself.
Not sure how the finances go, but swapping out expensive large stores for cheap industrial estate warehouses might fund the drone delivery element - so you say "I'll have spag bol tonight" and either the ingredients get delivered by drone, or a ready cooked meal.
Amazon launches full online supermarket service in UK - BBC News
I kind of wonder if the idea of the 'weekly' shop mightn't disappear if drones really go forward. You can see the synergy between drone delivery of fresh food, etc. as needed, and the delivery of fast food such as pizzas, burgers, etc. also as needed. That's particularly true if the fast food cooking service gets automated itself.
Not sure how the finances go, but swapping out expensive large stores for cheap industrial estate warehouses might fund the drone delivery element - so you say "I'll have spag bol tonight" and either the ingredients get delivered by drone, or a ready cooked meal.
Home delivery has been around for ages, so why would it change with drones? You'll actually find that more and more people are going back to the roots and the farm shop is becoming more popular.
Jun 10th 2016, 9:48 am
#24
Lost in BE Cyberspace
Joined: Dec 2010
Posts: 14,040
Re: The world of automation
Remind me never to go into business with you.
The purchase, wage, utility, and probably a fair amount of 'other' are all variable costs. As sales go up, they go up, if you do nothing else. If you were somehow able to increase sales by 20% without increasing the marketing budget, you would still only see a small uptick in the profit line as you needed to give more to McD central of prepackaged burgers, employ more staff, etc.
Whereas if you chopped that 24% down to 4% ....
The purchase, wage, utility, and probably a fair amount of 'other' are all variable costs. As sales go up, they go up, if you do nothing else. If you were somehow able to increase sales by 20% without increasing the marketing budget, you would still only see a small uptick in the profit line as you needed to give more to McD central of prepackaged burgers, employ more staff, etc.
Whereas if you chopped that 24% down to 4% ....
Jun 10th 2016, 9:52 am
#25
Lost in BE Cyberspace
Joined: Dec 2010
Posts: 14,040
Re: The world of automation
Where do I land the pizza?
Jun 10th 2016, 9:59 am
#26
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Posts: 24,246
Re: The world of automation
Big money - Rinehart, Forrest - moving in
A bright future feeding Asia
American agriculture is strong
Jun 10th 2016, 10:07 am
#27
snɐןɔ ʎʇıuɐs
Joined: Nov 2006
Posts: 6,558
Re: The world of automation
And lab grown meat is a thing. In 2013 a lab grown burger cost $330,000, by 2015 it was $12. It doesn't take long at that rate to get that to $1 for a burger, made of Kobe beef. Doing it that way reduced land use by 99% and water by 90%, as well as not producing the climate change gasses that cows do and reducing energy use by 45%.
In short, although it will take research work, I wouldn't want to be owning a cattle station the day after someone solves the remaining problems.
Jun 10th 2016, 10:09 am
#28
snɐןɔ ʎʇıuɐs
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Re: The world of automation
Actually I'm thinking that there is a nice business and patent opportunity in solving those problems. I have some thoughts....
Jun 10th 2016, 10:31 am
#29
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Re: The world of automation
The technology exists today to operate airliners without pilots - and this technology is only going to improve
But are people going to accept flying in a plane across the pacific ocean from Sydney to Los Angeles?
I know I'm certainly not - and I would imagine that most other people think the same too
Good time to be a pilot or technician or an engineer or a flight attentant in a growing industry - 1m people airborne at any one time, all the time, as I saw on an excellent BBC show the other day. 100 0000 flights a day - that's at least 200 000 pilots. Airbus has orders for over 4500 A320neo aircraft alone
But are people going to accept flying in a plane across the pacific ocean from Sydney to Los Angeles?
I know I'm certainly not - and I would imagine that most other people think the same too
Good time to be a pilot or technician or an engineer or a flight attentant in a growing industry - 1m people airborne at any one time, all the time, as I saw on an excellent BBC show the other day. 100 0000 flights a day - that's at least 200 000 pilots. Airbus has orders for over 4500 A320neo aircraft alone
Last edited by Amazulu; Jun 10th 2016 at 10:33 am.
Jun 10th 2016, 10:42 am
#30
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Re: The world of automation
Don't see any extra jobs, probably the reverse as more automation eats into those jobs that remain. There's about 307,000 jobs in farming, but the number is falling.
And lab grown meat is a thing. In 2013 a lab grown burger cost $330,000, by 2015 it was $12. It doesn't take long at that rate to get that to $1 for a burger, made of Kobe beef. Doing it that way reduced land use by 99% and water by 90%, as well as not producing the climate change gasses that cows do and reducing energy use by 45%.
In short, although it will take research work, I wouldn't want to be owning a cattle station the day after someone solves the remaining problems.
And lab grown meat is a thing. In 2013 a lab grown burger cost $330,000, by 2015 it was $12. It doesn't take long at that rate to get that to $1 for a burger, made of Kobe beef. Doing it that way reduced land use by 99% and water by 90%, as well as not producing the climate change gasses that cows do and reducing energy use by 45%.
In short, although it will take research work, I wouldn't want to be owning a cattle station the day after someone solves the remaining problems.
Tuck in lads
Last edited by Amazulu; Jun 10th 2016 at 11:17 am.