The Restaurant industry has changed abruptly. Was this due to the Corona? Possibly, but it seems to have been inevitable either way. Ghost kitchens are important to know about for those of you looking to make extra money for your restaurant. This applies to anyone in the food industry. In this post, we’ll define Ghost Kitchens, show a few examples of how they are used in business today, and truly show you what a Ghost Kitchen is.
What is a Ghost Kitchen: By Definition
RSS Feed A Ghost Kitchen is a food preparation facility specifically built for delivery-only food businesses. Also known as: dark kitchens, cloud kitchens, and virtual kitchens, they have recently emerged and have become a new source of income for big and small companies. Let me explain to you the importance Ghost Kitchens serve.
What is a Ghost Kitchen: How it Began
There is no exact data found that tells us where the first Ghost Kitchen originated but most sources point to San Francisco. With high real estate prices, scarcity of commercial real estate, and forced closure during the pandemic, delivery was the best move to make for restaurant owners. Delivery actually goes back more than a century in Campania, Italy in 1889. The king and queen at the time had pizza delivered to them. I do not know what delivery app they used at the time, but I imagine the order came from a kitchen, not a restaurant. Moving to modern times, during pandemic, restaurants were thrown a curveball. Cracker Barrel had a sales decrease of over 39%. This motivated them to open up their own Ghost kitchen to increase their online delivery capabilities. This one location in Indiana converted into a catering-only location to make up for lost sales from their dine in customers. This is a smart move being that they have many locations to spare, making one restaurant fully focused on catering and online delivery.
What is a Ghost Kitchen: How it Works
Ghost kitchens revolve completely around delivery. If you do not want to use your restaurant's brand for your delivery-only service, you will need to create a virtual restaurant, which you can learn more about in our virtual restaurant blog. Imagine you are in the middle of the city, and you are hungry. You go into a food delivery app on your phone like Grubhub, and you place an order from a restaurant like Sam's Crispy Chicken. This meal is delivered from a kitchen in an unknown location that can be preparing meals for many different virtual restaurants. You cannot visit or sit down at this kitchen and you can only order from it through food delivery apps like Grubhub.
What is a Ghost Kitchen: The Importance
There are multiple reasons why Ghost kitchens are turning the tables of the restaurant industry. To name a few:
We all knew inside that food delivery was eventually going to boom, and the demand for delivery is higher now than ever. Food delivery sales reached over $25 billion in 2020 in the U.S. alone. Statista predicts that By 2030, ghost kitchens are predicted to hold a 50 percent share of the drive-thru and takeaway foodservice markets. If this is true, that means that the entire restaurant industry will be restructured!
There is an unlimited amount of ghost restaurants that you can launch on these apps. With this in mind, it is now a matter of marketing and making your restaurant appear at the top of the search results. The sales potential is unlimited, but more work will be required to keep your restaurant profitable.
- Low startup and overhead costs
- High demand for food delivery
- Unlimited sales potentials
We all knew inside that food delivery was eventually going to boom, and the demand for delivery is higher now than ever. Food delivery sales reached over $25 billion in 2020 in the U.S. alone. Statista predicts that By 2030, ghost kitchens are predicted to hold a 50 percent share of the drive-thru and takeaway foodservice markets. If this is true, that means that the entire restaurant industry will be restructured!
There is an unlimited amount of ghost restaurants that you can launch on these apps. With this in mind, it is now a matter of marketing and making your restaurant appear at the top of the search results. The sales potential is unlimited, but more work will be required to keep your restaurant profitable.
What is a Ghost Kitchen: Trends
One forecast I will make about the future that ghost kitchens will bring is major competition. There is a small number of delivery apps that are in control right now, and they will fight and compete to keep control; buying out startups, reducing prices, etc. Uber Eats is now claimed to rank the highest in sales for all delivery apps.
Some trends that you may not know about are happening right now! Companies are now bringing Ghost Kitchens to apartment Communities. This will have a major ripple effect. We have yet to see what is next. One forecast I will make about the future that ghost kitchens will bring is major competition.
Some trends that you may not know about are happening right now! Companies are now bringing Ghost Kitchens to apartment Communities. This will have a major ripple effect. We have yet to see what is next. One forecast I will make about the future that ghost kitchens will bring is major competition.
What is a Ghost Kitchen: Examples Today
Some of America's favorite food chains have already launched their own Ghost Kitchens. Chipotle launched Chipotle Digital Kitchen on November 11, 2020, in New York. This location was opened to serve the urban areas where there is limited space for a dine-in restaurant. There are many other corporate ghost kitchens like Pasqually's, The Wing Experience, and It's Just Wings that are owned by popular food chains. A good majority of these Ghost Kitchens sell chicken products, a big trend right now in the industry.
What is a Ghost Kitchen: Conclusion
If you haven't known by now about the secret trend happening in the food industry, it is a fast moving train to say the least. Ghost Kitchens are bound to populate rapidly and make their way across every channel. If you are still asking yourself, what is a Ghost Kitchen? It is a food preparation facility/kitchen built only for delivery orders that is only available in food delivery apps. If you have any more questions or are interested in opening a ghost kitchen, please contact me at marketing@ordyx.com.
Author
Ryan Taylor Graves - Marketing Analyst