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TransAct Technologies is gearing up to revolutionize the Food Preparation Industry with its Saas-Based BOHA application

06 Feb TransAct Technologies is gearing up to revolutionize the Food Preparation Industry with its Saas-Based BOHA application

TransAct Technologies Inc (NASDAQ: TACT), a Company developing innovative printing solutions and software-driven technology, has announced the signing of an agreement for its BOHA, a novel cloud-based solution that is designed to automate ten time-consuming, error-prone tasks, resulting in a reduction in labour and cost for the company. The Company has secured an agreement with a regional convenience store chain for deployment of the BOHA system at 100 of their locations, which are expected to go live this year, as per a Company statement.

The systems will use BOHA to support their fresh food handling and adherence to FDA labelling compliance and as such the systems being offered include BOHA! Labelling SaaS-based app, TransAct Enterprise Management System alongside the BOHA! Terminal as well as TransAct Premier Express Service and Transact specifically designed labels. The Company is expecting total annual recurring revenue per unit per site of $1,200 per year.

Bart C. Shuldman, Chairman and CEO of TransAct Technologies, commented

“Convenience stores are experiencing revenue growth as they introduce fresh food offerings to their customers. As part of their initiative they need to be able to comply with specific FDA labeling requirements. Our BOHA! system solution is built to ensure convenience store operators have a simple and reliable way to ensure FDA labeling compliance, food safety and improve productivity for employees managing fresh food offerings,” He further added, “We believe BOHA! Labeling and TEMS will be immensely helpful to the convenience store market as more and more companies look to grow their revenue with fresh food offerings.”

BOHA is the first comprehensive single-vendor solution that is designed to automate and enhance the functioning of back-end operations. The apps can be used either individually or as a suite of products and are compatible with Android as well as iOS. The offerings include Food Preparation, Labelling, Checklists, Temperature, Sense, Inventory, Timer, Food Recall, Service and Delivery. The technology has the potential to improve the operational aspect of foodservice and comes with cloud-based SaaS applications and hardware that is built on purpose to comply with the demands of a commercial kitchen environment. The hardware is mobile-centric and comes equipped with accessories that work seamlessly with other applications.

TransAct Technologies Inc (NASDAQ: TACT)

Market Cap: $77.38M; Current Share Price: 10.35 USDChart
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The U.S Food Safety Modernization Act (FSMA) mandates that companies dealing with food have to necessarily implement appropriate processes, to ensure proper handling of food recalls, and establish an effective food safety plan. Additionally there are other regulatory requirements in the form of Hazard Analysis and Critical Control Points (HACCP), Global Food Safety Initiative and other industry specific requirements that have to be complied with, which can be addressed by using an effective Enterprise Management System that can offer traceability, verifiability and accountability. The services that these systems provide range from document management, auditing or traceability trials, recall management, and maintaining production quality.

The onset of technological advancements, especially in the emergence of cloud-based Saas platforms that offer convenience, efficiency and cost reductions are revolutionizing the food industry. According to a report by Grand View Research Inc, the global restaurant management software market is expected to grow at a CAGR of 14.6% to reach USD 6.94 billion by 2025. The growth in the market will be driven by increasing adoption of technology to automate mundane error-prone tasks that can be better performed by automation resulting in reduction in labor and cost savings.

In addition the need to streamline processes to simplify operations and achieve regulatory compliance in areas such as inventory management, payment processing, labeling compliance etc will propel the demand for these services further.

TransAct Technologies is a leader in market-specific solutions for restaurants, convenience stores, and foodservice operators. The Company’s expertise in simplifying back-end operations helps operators comply with stringent food safety regulations, while reducing cost and gaining insight into their operational issues.

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The Company also offers technological solutions for the Casino & Gaming, Lottery, Oil & Gas, Medical, and Mobile industry, along with providing customers with supplies and consumable items. TransAct is considered to be the industry standard for high-quality and innovative approaches to problem solving. In addition to its restaurant technology solutions, the Company also designs and manufactures impact, thermal printers and software for the casino and gaming industry. It also serves the Oil and Gas markets, besides supplying consumables to clientele around the world. TransAct’s operations are spread across the globe in countries such as Americas, Europe, the Middle East, Africa, the Caribbean Islands, and the South Pacific.

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Furthermore the Company also manufactures Accudate terminals that are purpose built to manage the food labeling process and handle date code labeling along with SFTP menu updates. TransAct also offers POS Automation Kiosk Printers, under the brand name Ithaca, which are tailored to match the requirements of specific industries including hotels, restaurants, kitchens and kiosks. The Company has solutions for a range of services such as date code labeling, Grab ‘N Go labeling, Digital Temperature taking and monitoring, inventory management, custom checklists, food recall and withdrawal management.

TransAct’s printer and software solutions for the Casino and Gaming market include EPICENTRAL that enables casino companies to print targeted promotions and offers in real-time. The next-generation promotional bonusing software suite can target customers in real-time, resulting in more time on device, increased player spend and increased customer loyalty.

Risk Assessment

  • The Company offers a unique combination of Cloud-based SaaS applications with hardware and accessories that improve back-end operations. The demand for the Company’s services is evident with its growing list of clientele including a major unidentified U.S Food service provider, which signed an agreement for deployment of the BOHA Solutions across more than 400 locations in July 2019. Furthermore it already has a captive audience with its restaurant printer business, which offers potential for up selling.
  • The food preparation industry is undergoing a transformation due to emerging technology that provides significant opportunities for growth and automation. The Industry is likely to see stringent government regulations, shortage of manual workforce and their rising costs and an increasing demand for automation. The Company’s offerings are tailored to address these issues.
  • TransAct’s offerings have evolved over time starting with its terminal and printer business that was sold to varied industries such as restaurants, gaming and casino, lottery and oil and gas. Starting with an easy decipherable food rotation labels and receipts, the Company launched its cloud-based restaurant management solution business, which is poised to be the future of the food preparation industry.
  • Casino and Gaming occupies the highest revenue generating market segment for the Company currently, with a considerable portion of its revenue being generated through the sales of its printing solutions for promotional coupons and offers in real-time. The casino market is a burgeoning industry and offers an excellent opportunity for growth and expansion to the Company.
  • TransAct BOHA has the first mover advantage as it provides an open API that is compatible with other service providers and can be used to integrate other services easily. In addition the cost of switching systems, retraining and replacement costs may act as a barrier to entry for other similar operators that may crop up later. Its cloud-based solutions are especially beneficial for multi-location operators as they may be able to access data through a centralized cloud.
  • Though BOHA has the potential to revolutionize the food preparation industry and meets a pressing need, its target customers are typically entities who may not be well capitalized or have the necessary funds to invest in the saas cloud-based enterprise ecosystem. This could prove to be challenging for its long-term growth.
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