A Primer on PAR Technology

Cornering the POS software market for fast casual restaurant chains and expanding beyond.

• We have followed PAR Technology (PAR) for a long time and have seen it develop from acquiring Brink, a small POS system for restaurant chains as a side business, into the leading provider, through internal development and smart acquisitions, and selling what used to be their main business.

• They now have a full suite of solutions (see below) and are approaching cash flow positive. The added products increase the TAM, reduce customer churn, and create cross-selling opportunities. Most revenues are SaaS, although they generate sales from hardware as well as professional services as well.

• The company is very well managed, and we see a future of years of 15%-20%+ ARR growth creating considerable operating leverage. They had to digest three significant acquisitions last year. Things are now on track, even if ARR growth was 15% in Q2/25 due to slower customer implementations (like Burger King halting to order a second PAR product line -PAR OPS-, a nice problem to have).

Company Overview

PAR is a global foodservice technology company that provides leading omnichannel cloud-based software and hardware solutions. Their services cater to the restaurant industry, specifically quick service, fast casual, and table service, as well as the retail industry, including convenience and fuel retailers (C-Stores). As of December 31, 2024, PAR employed 1,585 people worldwide, with 1,581 full-time.

Their product and service offerings include:

• Point-of-sale

• Customer engagement and loyalty

• Digital ordering and delivery

• Operational intelligence

• Payment processing

• Hardware

• Related technologies, solutions, and services

PAR's omnichannel solutions are utilized in over 140K active restaurants and retail locations across more than 110 countries. They aim to provide enterprise restaurants, franchisees, and other foodservice outlets with operational efficiencies through a data-driven network with front- and back-of-house to customer fulfillment integration capabilities.

Acquisitions

The year 2024 saw several significant strategic moves for PAR:

• Stuzo Acquisition (March 2024): This acquisition of a digital engagement software provider to C-Stores expanded PAR into an adjacent vertical, making it a leader in technology for convenience and fuel retailers.

• Divestiture of Government Segment (June & July 2024): PAR divested PAR Government Systems Corporation (PGSC) and Rome Research Corporation (RRC), ceasing operations in the Government segment as of June 30, 2024, to operate in a single reportable segment.

• TASK Group Acquisition (July 2024): PAR acquired TASK Group Holdings Limited, an Australia-based global foodservice transaction platform. TASK Group offers international unified commerce solutions, including interactive customer engagement and seamless integration, tailored for major brands worldwide. Its platform, TASK, is used by Starbucks Corporation and Guzman y Gomez, and its loyalty platform, Plexure, is used by McDonald’s Corporation in 63 markets. This acquisition enables PAR to serve top enterprise foodservice brands globally with a unified commerce approach.

• Delaget Acquisition (December 2024): PAR acquired Delaget, LLC, a provider of restaurant analytics and business intelligence solutions. Delaget's platform delivers data analytics, loss prevention, and operational insights to help restaurant operators streamline operations and improve profitability.

Products and Services

Management has been expanding the products through internal development and acquisitions, building a unified platform that works seamlessly together on the same data.

Subscription Services (SaaS) These services include software-as-a-service (SaaS) solutions, software support, managed platform development, and transaction-based payment processing. They are grouped into two product lines:

Engagement Cloud

(customer-facing solutions):

PAR launched its unified Engagement Cloud with AI-driven tools and deep cross-product integration in June 2025:

What’s Inside PAR® Engagement: One Unified Flywheel. Every Guest Journey. Connecting marketing, loyalty, and ordering systems into one integrated platform, eliminating data silos and unifying the digital guest journey. PAR® Engagement is built around PAR’s unified product flywheel, which powers smarter engagement at every stage

• PUNCHH: An enterprise-grade customer loyalty and engagement solution that uses AI-powered tools to deliver personalized promotions, omnichannel loyalty experiences, real-time 360-degree insights, and drive repeat purchases and higher average spend.

• PAR ORDERING: An eCommerce platform for digital customer touchpoints (mobile, web, kiosk, delivery marketplaces), providing tools to grow digital business, manage orders from all channels, orchestrate delivery, and control the digital experience to retain direct customer relationships.

• PAR RETAIL: A digital engagement software for C-Stores, enabling seamless, personalized experiences across mobile, web, and in-store channels, leveraging data-driven insights to increase customer engagement, loyalty program participation, and same-store sales.

• PLEXURE: An international customer engagement and loyalty platform from the TASK Group acquisition, delivering hyper-personalized marketing campaigns and promotions in real-time. It uses advanced data analytics and machine learning to integrate with existing systems, providing actionable insights to boost customer lifetime value, repeat transactions, and same-store sales.

• Guest Data: Unifies identity and insights across loyalty and non-loyalty guests, giving marketers a new way to recognize, personalize, and activate across all marketing channels.

• Marketing & Offers: Proven through Punchh®, this module now supports personalized campaigns for all guests, not just loyalty members, creating greater reach and return to every offer.

• Supporting the flywheel are two new layers:

  • Accelerate is a growing suite of tools designed to increase check size, repeat visits, and campaign ROI.

  • Digital Experience brings your brand to life across every guest touchpoint from mobile apps to digital wallets.

Operator Cloud

(front-of-house and back-of-house operator solutions):

• PAR POS: An open cloud, point-of-sale solution that integrates with multiple product offerings like kiosks, kitchen video systems, and enterprise reporting through PAR's ecosystem of integration partners.

• PAR PAY: Includes PAR Payment Services for electronic payment processing (online or in-person) and PAR Pay Gateway, a front-end technology for reading payment cards. Together, they offer a comprehensive solution for various payment methods including debit/credit cards, NFC contactless, mobile devices, digital wallets, and gift cards.

• PAR OPS: Incorporates Data Central and Delaget product offerings, leveraging business intelligence, analytics, and automation to streamline operations. It aggregates data from POS, inventory, supply, payroll, and accounting systems to deliver actionable insights, simplifying complex data into intuitive dashboards and reports.

• TASK POS: An enterprise-grade technology solution from the TASK Group acquisition, streamlining operations for hospitality and retail. It specializes in point-of-sale, kitchen management, and inventory systems, offering a transaction management platform that integrates seamlessly with existing infrastructure.

PAR employs a double-pronged POS strategy:

• PAR POS (retitled from Data Central) for domestic brands.

• TASK POS (coming from the acquisition of TASK) for global brands.

General SaaS Capabilities: PAR's SaaS solutions are extensible and built on open application programming interfaces (APIs), enabling integration by more than 550 integration partners, including leading industry brands.

Hardware

PAR's hardware offerings include:

• Point-of-Sale Hardware: Durable and highly functioning POS terminals (PAR WAVE, PAR PHASE) and EverServ POS tablets designed for harsh foodservice environments. These open architecture platforms are optimized for PAR's SaaS solutions and many third-party POS software applications.

• Wireless Communications, Drive-Thru Systems: Wireless headsets (PAR G5, PAR Clear) for drive-thru order-taking, providing clear audio. Drive-thru timer systems offer near-real-time feedback to improve speed of service.

• In-Store Peripherals: Partnerships with vendors provide integrated solutions for payment devices, cash drawers, and printers.

Professional Services

PAR offers a comprehensive portfolio of support services:

• Hardware repair: Depot repair, warranty, and overnight Advanced Exchange services from offices in San Diego, CA, Mississauga, ON, and New Hartford, NY.

• Installation and implementation: Services for hardware installation and software implementation.

• Training: Application training for in-store staff and technical training for customers’ information systems personnel.

• On-site and technical support: On-site support in the continental U.S. through a field tech service network, and 24-hour help desk support from diagnostic service centers in New Hartford, NY, and Tampa, FL. Outside the continental U.S., services are provided directly or through authorized providers.

Strategy

Through internal development and acquisitions, PAR is creating a unified platform operating on a single customer data set, which sets a flywheel in motion and produces multiple advantages:

• The unified platform operating on a single data set produces economies of scale.

• Adding more products through acquisitions and internal development:

  • Produces economies of scope (more solutions operating on the same platform).

  • Produces additional entry points for prospective customers.

  • Opens up additional cross-selling and upselling opportunities.

  • Produces a more comprehensive platform, becoming more attractive for larger (Tier 1) customers like Burger King, increasing customer stickiness and lifetime value.

  • Setting in motion a flywheel effect:

Sales and Marketing

PAR sells its products and services to enterprise restaurants, franchisees, other restaurant outlets, C-Stores, and other retail customers like amusement parks, cinemas, cruise lines, spas, casinos, and ticketing/entertainment venues.

• Sales Teams: Organized into two main areas:

  • Enterprise customer sales: Focus on tier-one (500+ sites) and tier-two (50-499 sites) customers, which typically involve requests for proposals (RFPs) and longer sales cycles, supported by premier support and pre-sales engineers.

  • Small to medium-size businesses: Focus on simplified solutions and quicker implementation.

• Channel Partners: Leverages a network of resellers, distributors, and integrators to extend selling opportunities.

• Key Relationships: Longstanding relationships with major restaurant brands, including McDonald's Corporation (since 1980), Yum! Brands (since 1983), and Dairy Queen (since 2018). McDonald's Corporation represented 15% of total revenue in 2024.

• Sales and marketing expenses were $41.7 million in 2024.

Competition

The markets are highly competitive and rapidly evolving, with competition based on features, functionality, user experience, integration, delivery method (cloud vs. on-premise), product design, quality, reliability, development capabilities, price, and customer service.

• Competitive Advantages: PAR's strengths include its open integration platform, enterprise-grade omnichannel cloud-based software and hardware solutions, development capabilities, extensive domain knowledge, excellent product reliability, direct sales teams, and responsive customer service. Their customer base, primarily enterprise and fast-growing brands, is also a competitive advantage.

• Challenges: Rapid adoption of new technologies (like AI in product development), constant introduction of new offerings, and aggressive pricing strategies can affect their ability to compete. Competitors, including those targeting lower market tiers, may have greater financial/technical resources, more relevant offerings, and larger customer bases. Expanding into new markets also introduces established and new competitors.

Supply

PAR has agreements for hardware products and components, including long-term or volume-based purchase agreements. They maintain alternative sources and safety stocks of single source hardware products to protect against supply chain disruptions. To mitigate risks, they expand their supplier network, increase inventory of scarce components, and adjust pricing.

Research and Development

Product research, innovation, and product development are integral to PAR's business. They continuously evaluate customer needs and new technologies. PAR leverages AI to assist in code generation and other product-related artifacts, driving efficiency and innovation. R&D expenses were $67.3 million in 2024.

Intellectual Property PAR relies on intellectual property laws, confidentiality procedures, and contractual provisions to protect its IP. This includes U.S. and foreign patents, registered and common law trademarks, and copyrights related to software and product characteristics. They also use confidentiality and assignment-of-invention agreements with employees and consultants, and licensing agreements with customers and third parties.

Stay tuned for our Quick Take on PAR Technology where we discuss the investment prospects.