12/13/2023 0 Comments Dark cloud money makingThis is why it’s so popular as a stop-gap measure during pandemic-related lockdowns. Upfront investment - low. In a pinch, most existing restaurants can pull this off to increase volumes and stave off layoffs and financial ruin. The restaurant partners with a few aggregators to handle orders and delivery (but can also run its own delivery). Sometimes, it’s a measure to bridge a cash flow problem or a way to test out new menu ideas and concepts.ĭine-in and delivery production lines are separated, with similar (but different) menus. The delivery side of the operation is almost exclusively geared towards creating an additional revenue stream. Typical setup: The kitchen is located in a high-rent, frequented area. The brand can then cover more ground through pop-up locations while keeping costs under control.Ī restaurant takes its menu hits and tweaks them for delivery. The best scaling tactic requires a slight tweak in the model - expanding the original operation and creating a centralised kitchen. However, an owner of a dine-in restaurant is often better off running a joint dine-in/cloud kitchen operation, at least until they’ve tested out their concept and the demand.īusiness scaling - doable with effort. A cloud kitchen is always a less substantial investment. Upfront investment - low. This is true if we’re talking about a new entrant that’s choosing between a dine-in restaurant and a cloud kitchen. Sometimes, the kitchen parallelly operates self-delivery, especially if it’s a well-known brand. Orders and deliveries are handled by several different aggregators to maximise exposure. It’s relatively small and streamlined and employs a skeleton crew. Typical setup: The kitchen is usually located in a lower-end rent area but not too far from densely populated spots. How profitable you can expect each one to be.Īnd we’ll start with the OG of cloud kitchens… the pureblood cloud kitchen.Ī brand-owned single-cuisine ghost kitchen is a delivery-only operation, with no takeaway and no dine-in.You’ll walk away with an in-depth understanding of: While this obviously can’t be the ‘ultimate guide’ it still packs everything there is to know about the cloud kitchen game, to date. This begs the question: are ghost kitchens a sustainable business model? Oh, and did I mention the global pandemic? It really accelerated the rise of ghost kitchens. Restaurants that add delivery to their offer restaurants that open pop-up stores to be able to service a particular area aggregators that break into the restaurant business grow profits… Couple that with the fact that fast delivery can only be profitable if it’s also a short run delivery (a couple of kilometres, at most), and you get a lot of business model experimentation. It also pushed restaurants to invest in their own delivery fleets. Well, blame the ‘amazonification’ of consumer experience and the concept of last-mile delivery.Ĭonsumers want everything right this minute, which gave rise to aggregator and delivery platforms. So… why are there so many different types of ghost kitchens? It’s a food production unit built exclusively for, and optimised for, food delivery. Cloud kitchen, dark kitchen and ghost kitchen are synonyms. Just so you know, you might see different names pop up. Shared kitchen with a mix of self-delivery and aggregator partnerships.Īnd on and on it goes.Brand-owned, with self-delivery, aggregator partnerships and no takeaway….Brand-owned, with self-delivery, no partnerships, and takeaway….And what’s making the situation more muddled is the fact that some operators are transitioning between concepts (and sometimes back). I counted anywhere between 20 and 40 different iterations of the concept. They are a smörgåsbord of moving parts, pivots, and changes. The fact of the matter is that cloud kitchen business models are still evolving. Here’s the thing - this was supposed to turn into a be-all-end-all post on the topic of cloud kitchen business models.Īt least, that was the plan until I hit the research equivalent of a brick wall.
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