Food delivery apps could be considered a modern marvel. There’s nothing quite like dining out without actually having to go out. As a result of these popular apps, the industry is experiencing explosive growth and in the most unexpected of ways - food delivery apps have given rise to ghost kitchens. So, what are ghost kitchens? Let’s explore this unique phenomenon and how it came to be.
What are Ghost Kitchens?
“Ghost kitchen” is a more popular term for what the industry also calls virtual kitchens, cloud kitchens and even dark kitchens. A ghost kitchen is a restaurant that functions or operates solely for delivery or take out. These “kitchens” often lack any signage or suggestion of a store front and they are typically devoid of anything like a dine-in area.
The focus of ghost kitchens is to accept online orders, usually through food delivery apps, and then prepare those orders for pick up and/or delivery. These facilities do not have the typical front-of-house/back-of-house structure that one expects from a restaurant. There are neither servers nor hosts. Décor is neither expected nor needed. There are no chairs, tables or other standard dining amenities. The space is specifically optimized for food preparation and delivery only. There is literally no other agenda for these kitchen workers.
A ghost kitchen menu is not generally printed for patrons. They mostly exist online by way of a website or food delivery app. A ghost kitchen can be attached to apps such as Door Dash and Uber Eats or it can have an app all its own.
Who Operates Ghost Kitchens?
Ghost kitchens can operate under a number of different business platforms. They can be owned and operated by local or independent entrepreneurs. They can also be owned by large chains or, as just mentioned, even the delivery platform itself. Ghost kitchen may also simply rebrand chains or restaurants you’re already familiar with. So long as you have the proper permits, a kitchen space, a cooking staff and delivery platform you, too, can have your very own ghost kitchen for all day menus or lunch and dining options.
When Did Ghost Kitchens First Form?
Believe it or not, ghost kitchens are nothing too new. The idea for ghost kitchens took shape around 2010 (give or take) as online ordering and food delivery services started to build momentum. Rising rents in certain commercial areas also posed a red flag for several existing brick-and-mortar restaurants. This drove many to scale back their business and operate only from spaces that were solely dedicated to food preparation.
Ghost kitchens came to be in the early 2010s but then exploded in popularity in 2020. What could have possibly led to this sudden rise in popularity? The pandemic significantly accelerated the growth of the ghost kitchen industry as those brick-and-mortar eateries were forced to re-evaluate their day-to-day operations over the course of rolling international lock-downs. Dining in quickly became popular because dining out was, well, not advised. As a result, the ghost kitchen and food delivery industry flourished and there are no signs of it slowing anytime soon.
What are the Benefits of Ghost Kitchens?
The immediate benefits of ghost kitchens are obvious: these facilities can clearly operate on a much smaller scale. This means that overhead costs are minimized and that, of course, suggests a greater potential for a day-to-day return on investment.
As a result of this highly focused operation, ghost kitchens can work much more efficiently than standard restaurant platforms. Ghost kitchen personnel have just one task at hand. There are no other periphery jobs or concerns. The bathrooms won’t need to be cleaned nearly as often. Condiment bottles won’t need to be checked or refilled. There is no need to bus tables or queue and seat waiting patronage. There will be no in-house customer complaints about service that need to be quickly calmed. There is only the kitchen, the menu and the operating staff.
Ghost Kitchens also have a positive effect on overall scalability. Menus can be more fluid. It’s also easier to launch several brands at once out of the same kitchen. Perhaps an owner or chef wants to test a new product or dish. That’s not a problem at all. It’s just that much easier to sample a few experimental items on a digital menu just to see if it’s a hit or miss. Ghost kitchens can also more easily pursue and prepare popular seasonal or holiday menu items from month-to-month or quarter-to-quarter.
Another benefit of ghost kitchens is that they can operate from anywhere. The common real estate cry about “location, location, location” doesn’t necessarily apply when it comes to the ghost kitchen industry. A ghost kitchen can be set up anywhere and often owners look towards lower-rent areas instead of more commercially active high-rent spaces.
What are the Drawbacks of Ghost Kitchens?
You might wonder if there is a downside to operating a ghost kitchen. So far, it sounds like an excellent platform and an enticing new way to seek out and find eager new patrons. However, there can be a few downsides to operating a ghost kitchen.
As an example, quality control can become an issue. Many “home” diners will note that ghost kitchens sometimes lack consistency when it comes to preparing a favorite meal. While your favorite menu item at an area restaurant always tastes the same because it is always prepared the same, you might find that this is not exactly the case when it comes to ordering from a ghost kitchen menu.
You may not even know that you’re ordering from a ghost kitchen menu. There’s no real sense of transparency yet with this new business platform. This could also lead to inconsistencies when it comes to ordering and enjoying your favorite meals.
Another concern centers around market saturation. With too many ghost kitchens operating and cooking from a variety of local or national chain menus, it can quickly become confusing for consumers. Also, market saturation in any industry tends to affect the bottom line. Despite lower operating costs, many ghost kitchens struggle with relatively thin profit margins. This leads to the next big question…
What is the Future of the Ghost Kitchen Industry?
Despite the issues concerning market saturation, the ghost kitchen industry is projected to see considerable growth moving forward. Ghost kitchen revenues are expected to more than double by the year 2032. Despite the aforementioned vulnerabilities, this mighty growth will likely be supported by our culture’s continued demand for convenience.
While some dine out for the ambience, many consumers dine out for a quality meal. So long as a delivery option is available, those same consumers will more likely opt for in-home delivery. Of course, sometimes you just need to get out of the house but convenience is hard to beat, especially when it comes to enjoying your favorite restaurant meal in your own home with family and friends.
Smart kitchen technology is also coming into its own. These days, smart tech can enable real-time data collection for ghost kitchens. This allows for more efficient inventory management, smoother delivery schedules and improved food safety preparation.
As the tech becomes more available and, thereby, more affordable, it will likely help add to the booming popularity of ghost kitchens across the country and globe. There’s no doubt that ghost kitchens are evolving quickly and taking full advantage of the popularity of delivery platforms. As a result, ghost kitchens are very likely to play an increasingly important role in the future of our ever-evolving food industry.
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