Ghost Kitchens are kitchens without any dining facility. They do not have counters or dining zones or service windows. These kitchens exist in private locations, and the client in a usually in another geographical location. The food is delivered by a third party app to the customer or customer can come for a takeout or carry home by self.
A regular restaurant has a kitchen-room, a reception desk, a eating area (ac space/open area), 2 to 10 waiters depending the size of the business and other employees, other infrastructure like tables and chairs and its maintenance, electricity, halls and lobbies etc. in some restaurants. Imagine the amount of manpower and maintenance that is needed for a setup like this.
In contrast a ghost kitchen focuses on the core essential of the business which is food and the quality of that food. It has no other facility or infrastructure and the food is delivered to the required location at the required time through third party delivery guy. So let us know about the advantages and disadvantages of this type food business aka Ghost Kitchens.
Advantages of Ghost Kitchen
You Can Get Started With Less or No Infrastructure
If your starting a new business, this is a great option. Honestly, because until you understand your customers, learn and figure out strategies, it’s better to keep your cost and investments low. So you can make a head start and start with all that you already have as resources and then naturally make changes. There is no immediate need for a location, a employees, etc., so you can get started because of your speed, flexibility and ease without paying hefty rents or investing a lot of capital. It can be as simple as starting from your home
Using Spare Area Of Your Home or Office
This can be really good if you have a spare unused space or something that has been non-functional till date which can be used now. Let’s say you have a room on the ground floor of an apartment that has a ware house or a spare room, you can use it to store raw materials and spare stock so that the excess doesn’t occupy any of your existing space. This can also be one of the motivations why you might consider starting a business from your own location if you already have a business.
Be More Profitable
This is another advantage of ghost kitchen that you can also increase your profits as there is no additional investment or expense as you are using all the equipment that you already have. It will help you monitor and plan accurate pricing, help you analyze business flows and much more. You deduct the expenses and you may cooperate with the third party application only for the purpose of delivery. Excluding the minimal cost of using food delivery system. The rest is yours earned. This will help give you time to analyze and increase your profitability as home delivery of food is much preferred when you go out to eat.
Flexible timing helps you to save your timing, there is no travel time or chaos and independent handling helps you to experiment with your inhouse specialties and gives you the time and practice to deal with the changes and get better and you Also gives an accurate idea of kitchen handling and management order. It helps you learn and achieve everything from the comfort of your own home. Nothing can be better than this, can it?
Like any other business, it also has its own set of issues. Let’s take a look at what are the disadvantages of ghost kitchens.
Disadvantages of Ghost Kitchen
This is one of the problems you may face because keeping everything small scale can deprive you of higher or bigger output that enterprises can achieve. It’s quite possible that getting used to and working on a small scale could keep you from being known on a viral scale or get higher publicity. You might be missing out on the kind of promotion you need when compared to a restaurant with an extravagant ambiance and PR. It might take you a little longer but then it’s a matter of how you keep your customers interested.
Less Publicity and free PR like social media
Social media is an integral part of any business in current generation. Online Campaigns and other marketing activities make it easy to keep customers and potential customers engaged and interested. It helps in building a branding like name, good image and thus increases the count of customers. Feedback/ratings, images etc help a lot in free marketing. These kitchens are like hideouts. They are not known to be publicized and hence it hampers a rapid growth of a business.
Difficult To Increase Profits
As it has become clear that ghost kitchen does not bring huge profit and revenue. Its a well known phrase – that you reap what you sow, This phrase is also replicated in ghost kitchen model – more investment-more profits and on the contrary these kitchens are a way to find and learn something to reduce expenses but to generate a decent revenue. There is no Full proof solution to building a solid business.
Less Customer Trust
Since these kitchens are not big well known brands, the customer may find them unreliable. Whenever we get to know where our food is coming from and we know that it is a big brand then we tend to blindly trust that the food we are going to get will be of the best quality. Whereas Ghost Kitchen Customers have to take the leap of faith to order from us. Thus it makes a difference when the customer can trust you.
So as we have seen listed above are some pointers that can help you decide on the advantages and disadvantages of ghost kitchen. You can go with the option that suits you best and you can do some changes or modifications to this business model as per your requirements. Hope the article helped you to understand this growing popular business model and the grass always looks green on the other side so hope this article helped you to get a neutral perspective. If you are a new budding entrepreneur then small steps are important as you have a lot to learn in such cases and surely Ghost Kitchen is a better option instead of making huge investments.
What is a Ghost Kitchen?
Ghost kitchens are similarly insinuated as smaller than usual cloud kitchens or virtual kitchens. They imply bistros that don’t offer eat in organizations. They are attempted to fulfill online orders, in this manner their menus are basically available to clients that require transport. Think of it as a collaborating space. There are no tables or walk around clients. You essentially rent a space, make a menu and start offering your food to online clients through untouchable transport applications.
As of now, ghost kitchens were transcendently being used by virtual bistros, yet after the pandemic obliged diner owners to take out errands or shut down, more chain restaurants have started embracing the thought. A couple of notable diners are playing with fanning out into virtual kitchens, while others like Chick-fil-a have actually embraced it.
How are Ghost Kitchens made?
Ghost kitchens rely upon the chief change in customer lead that all bistros have been experiencing; they decrease the costs related with feast in restaurants by taking advantage of the extension in web based orders.
The heavenliness of ghost kitchens is that you’re responsible for by far most of the practical points other than transport. You don’t should be arranged in a clamoring region, you don’t have to use waitstaff and you can without a doubt adjust your menu so it simply highlight on food that is movement pleasing.
The Power of Ghost Kitchens
In another report, Limetray found that when gotten some data about opening a diner, 67% of confident restaurateurs would incline toward opening a ghost kitchen over an eat in bistro as their next outlet. There are two or three basic advantages to this model:
Work on useful viability. Diners are engaged to set up their movement orders offsite during involved lunch and dinner hours without disturbing the blowout in guest experience.
Help scale and improvement. Diners can utilize the size of ghost kitchens to test new geologies and customer gathering without placing assets into expensive land.
Drive domination for the transport business focus. Ghost kitchens resemble Netflix’s interesting substance; business focuses are orchestrating uncommon thoughts on their association so clients stay secured.
Lower land and frank costs. Without the need to attract clients to your region, there’s not a great explanation to place assets into land or pay high rent for an area with high common action. There’s also not an obvious explanation to place assets into signage outside, eye-getting inside restaurant plan, or different excessive embellishments like goods, dishes, or cutlery.
Manage a more useful labor force. A ghost kitchen’s labor force involves head connoisseur subject matter experts, top partner gourmet specialists, dishwashers, executives, and movement drivers. Servers, agents, has, and front-of-house chiefs become obsolete. In this way, work costs – which ordinarily ingest 50-70% of the typical restaurants month to month pay – reduction, and staff revolves around conveying the best thing.
Offer genuine menu costs. Ghost kitchens can contribute the greater part of their money related resources into making flavorful dishes, testing new menu things, and expanding their high level impression. They can cost menus even more reasonably as they don’t need to deliver additional pay to cover the interest in various district of the business, especially as COVID has made little edges fundamentally more humble.
What’s the Difference Between a Ghost Kitchen and a Virtual Restaurant?
The two names are frequently utilized reciprocally, however they have a few distinctions. Both ghost kitchens and virtual eateries are café ideas that don’t have a physical eating experience. They exist exclusively online for conveyance or pickup.
Virtual eateries (in some cases called cloud cafés or conveyance just eateries) are normally new brands that run out of existing kitchens. For instance, It’s Just Wings is a virtual eatery that works out of existing Chili’s and Maggiano’s kitchens.
They made another idea utilizing comparable fixings, profiting by an altogether new market-in particular at-home avid supporters. Furthermore it’s succeeding. It’s Just Wings is relied upon to reach $150 million in yearly deals this year.
Different brands that are hoping to catch a similar open door incorporate Bloomin’ Brands (Tender Shack), Denny’s (The Melt Down and Burger Den), and Smoke Bones (The Wing Experience and the Burger Experience).
Ghost kitchens (likewise once in a while called cloud kitchens, dim kitchens, or virtual kitchens) are additionally just accessible on the web however don’t work out of a current café. They regularly have no physical partner by any stretch of the imagination. All things considered, they run out of a space leased from an outsider.
According to Fortune Business Insights™, The global kitchen appliances market size was USD 159.29 billion in 2019 and is projected to reach USD 210.80 billion by 2027, exhibiting a CAGR of 3.7% during the forecast period.