Cloud Kitchens - The New Way to Lunch
Meera BluePrint 08.14.2020
Discussion
The Food Corridor: “Everything You Need to Know About Cloud Kitchens (aka. Ghost Kitchens) in 2020”
Has COVID-19 changed your eating habits? If you answered yes, you are not alone. Unfortunately, due to the nature of the Coronavirus and the dangers packed rooms of people present to each other, restaurants have been forced to close their doors. As of July 24th, Yelp recorded that nearly 16,000 restaurants around the country have decided to close their doors permanently, a grim number that is only estimated to get larger. Restaurants have undoubtedly gotten creative, offering more delivery and curbside options, but what if there were already restaurants built for this?
Cloud Kitchens are commercial food production facilities where one or many restaurants prepare delivery optimized food items. Cloud kitchens are generally located around population centers and are built on technology and data. A cloud kitchen has two main components - a virtual consumer-facing restaurant that only exists on the cloud and a food production facility. Cloud kitchens are tech-enabled and use smartphone apps like UberEats, Grubhub, and Doordash to not only connect with customers and deliver food but also to optimize their business around real-time data. Added technology enables restaurant managers to optimize their offerings based on margins, time, seasons, and more. For example, The Food Corridor has found that “hot wings tend to be really popular between 11pm-2am near college campuses.” You may have been able to assume that, but the numbers don’t lie.
The first cloud kitchens broke into the commercial food industry in 2010 and have since attracted the likes of McDonald’s, Chick-fil-A, and more. According to Restaurant Dive “Ghost kitchens, or cooking facilities that produce food only for delivery with no dine-in or customer-facing areas, could create a $1 trillion global opportunity by 2030.” This would include stealing market share from drive-thru service (50% - $75B), takeaway foodservice (50% - $250B), ready meals (35% - $40B), packaged cooking ingredients (30% - $100B), dine-in food service (25% - $450B), and packaged snacks (15% - $125B).
Why are cloud kitchens taking everyone’s lunch?
COVID-19 has without doubt accelerated the move towards cloud kitchens but its not really a surprise the industry was moving this way regardless. Not only have consumers gotten more comfortable with the food delivery and platforms like UberEats, Grubhub, Doordash, etc. it also makes sense for the restaurant. Cloud kitchens allow for better efficiency, lower overheads, access to data, brand awareness, and multiple revenue streams (renting out kitchen space to other virtual restaurants, etc.). Cloud kitchens could change the way we not only prepare food - but also how we order, receive, and consume it.
Learn Something
ClusterTruck: My favorite cloud kitchen (so far)
The Kitchen Door: Find licensed, commercial kitchens for rent near you
The Food Corridor: Manage your shared kitchen with ease
CloudKitchens.com: How do they work?