The news: Dining-focused point-of-sale (POS) provider Toast acquired Sling, per a press release. Sling helps restaurants manage employee scheduling, internal communications, and payroll.

The environment: Toast is incorporating value-added services into its platform to help it compete in the lucrative restaurant sector. US food services and drinking place sales are expected to grow 14% year over year (YoY) in 2022 and hit $929.79 billion, per eMarketer forecasts from Insider Intelligence.

• Despite economic uncertainty in the US, the sector will outperform last year’s growth, making it an attractive space for payment providers.
• Providers like Toast can help restaurants improve the customer experience and streamline operations as they ramp up payments-focused investments: 54% of restaurant franchise owners cited mobile ordering as their leading area of investment for 2022, according to TD Bank.

The competition: Major payment players are doubling down on the restaurant sector.

• Many providers are tapping the space by forging partnerships: Oracle and Adyen recently teamed up to launch a contactless POS solution for restaurants.
• Block not only partnered with Vromo to streamline restaurant delivery but also acquired GoParrot, a dining-focused ordering and marketing platform. Going the acquisition route gives providers direct access to new tech and in some cases lets them capitalize on another customer base.

The opportunity: Toast can use Sling to build out its platform, helping it tighten client loyalty and attract customers. While Toast already has a solid standing in the restaurant payments sector—it has more than 57,000 restaurant clients—it can use Sling’s tech to help restaurants improve operational efficiencies and employee satisfaction. Seventy-five percent of global decision-makers agreed that increasing employee retention was a business priority when it comes to digital employee experiences, according to Forrester Consulting.

Sling can also help Toast build out its Payroll and Team Management suite, which helps restaurants speed up employee onboarding and payroll processes. This level of service granularity can help Toast stand out and solidify its position in the restaurant payments space, especially as Block and other competitors vie for more market share.

Related content: Check out The Era of Uncertainty: Merchant Services Providers report to learn how providers are adjusting their strategies to evolving market conditions.