The rat race of competition in the food industry always becomes an inspiration for new technology innovations. Cloud Kitchen is one of the recent innovations that saved the global restaurant industry during the pandemic outbreak. A report suggests that online food delivery market revenue is expected to reach $137,596 million worldwide by 2023.
Why Does Cloud Kitech Business Model in So Popular These Days?
Because you’re cutting costs on front decoration, sitting arrangement and maintaining cost and we can concentrate to run and market the Restaurant.
What exactly is Cloud Kitchen?
A cloud Kitchen is a new concept in the food delivery industry. It does not require brick-and-mortar stores, dine-in space, or take-away counters for this business. Customers can order food without looking for traditional restaurants that work as production units.
Also, businesses can enjoy the leverage of working without fancy infrastructure installation like tables, furniture, cutlery, hiring waiters, or more. Everything is available on the cloud, hence the name Cloud Kitchen. The cloud kitchen is also regarded as a ghost kitchen, virtual kitchen, or dark kitchen.
Different Cloud Kitchen Business Models
Every cloud kitchen business works on the same model, such as – receiving orders, preparing food, and delivering at the customer’s doorstep. The only difference is operations executions. Let’s have a look at different business models for delivery restaurants;
- Standalone Cloud Kitchen
As the name implies, a standalone cloud kitchen is a single brand own kitchen located in one place only. A standalone model does not offer dining space. Generally, these kitchens offer a one or two cuisine type having 15-20 menu items. These models rely on other food delivery channels to complete orders.
- Multi-brand Cloud kitchen
A cloud kitchen model provides multiple restaurant owners to share cloud kitchens with the prefix multiple. If someone is looking for an affordable way to start a cloud kitchen business, then it’s a perfect option.
Here, different brands cater to different customers’ needs with a variety of cuisines. Hence, restaurants under multi-brands are able to target more customers and generate higher revenue.
- Commissary (Aggregator) Kitchen
Commissary cloud Kitchen is one of the most trending business models. The aggregators invite top restaurants to prepare food for them and executives from these kitchen deliveries to customers.
UberEat is one of the biggest and well-renowned examples in this regard. UberEat invites top restaurants on the app and displays their menu on the app. People place an order, and delivery personnel from the UberEat food delivery app and get things at the doorstep.
- Outsourced Cloud Kitchen
Outsourced or operational cloud kitchen allows the restaurants to outsource almost everything except the finishing touches. The major brands listed under these separate online aggregators and receive orders from the cloud kitchen food ordering website/mobile app. The chef in these kitchens provides the final touch before the food goes out for delivery.
- Co-Working Cloud Kitchen
A coworking cloud kitchen is a large kitchen space where multiple restaurant brands work together under one roof. These top restaurant brands buy or rent space under one roof to run operations. These kitchens have separate units for each brand containing all the necessary equipment and utilities. Best of all, these kitchens work at locations with high customer demand, especially for a specific cuisine.
Who should think of opening a cloud kitchen?
If you have unique cooking ideas and want to enter the food industry with minimal cost, cloud kitchen is a perfect place for you. It allows newbies to embark on business without occupying physical assets but reach a wider audience with cloud kitchen applications.
Home-cooked food brands
If you want to see your home-cooked food praised by others taste buds. Opening a cloud kitchen is an ideal choice. You don’t have to invest much in it, but you can target the best audience.
Food truck operators
This option is for people looking for a fast-paced solution to expand the food truck business. Cloud kitchens can be your destiny to boost your reach as it opens up new opportunities to cook and deliver food in new areas.
Today people are expecting that food should reach their office or home whenever they need it. The increasing trend of food delivery business also motivates the dine-in business to adopt cloud kitchen technology with newer ideas.
Quick-service-restaurants who are seeking ways to boost their revenues, taking assistance from cloud kitchen solutions.
Building a Cloud Kitchen for the Millennials & Gen Z
Generally, younger generations called – millennials and Gen Z are the significant users of cloud kitchens. They value diversity, varieties, and urban living. Here we have some points you should keep in mind if you want to fulfill their appetite.
These Days, the idea of stepping out of home or cooking on your own is not appealing to millennials. They appreciate ordering food online. The modern food delivery business is offering better options with healthy food choices.
The younger generation is health-conscious also. They look for where the food is coming from? the Calories scenario, and whether it is organic or not. Brands need to align all these for the scale of awareness in apps.
- Demand for international cuisines
Gen Z wants to explore more and more. These can be international cuisines having a variety of tastes. Therefore, Italian, Thai, Japanese, Chinese, and French are winning hearts. These can be your business choice.
- Delivery experience
Delivery plays a most crucial role in boosting brand experience. Hence, always focus on packaging and feedback conversation to improve your delivery.
How can you start Cloud Kitchen Business?
Starting a cloud kitchen business involves lots of details. You need a restaurant, equipment, licensing, and food ordering app.
If you are a newbie, don’t fret. Here we have a step-by-step list of important things that help you to plan your next actions.
When choosing a cloud kitchen location, just focus on these minor details.
- Accessible delivery area: As all your business processes will be based on delivery. Therefore, choose a location that should be more accessible for delivery. It can be a central location or somewhere that has less traveling time, and hot food can be served to customers.
- Affordable: Price is the biggest determination. Make sure your location must be able to fit in your budget. If you are able to save over real estate or on renting, it will directly affect your revenue.
- Windows and space to breathe: Most people choose closed spaces, garages, and small complexes to cut costs. But, do not forget that it must have windows and space to breathe for your cook and staff.
- Safety-checked: A safety check should be your top priority. So, always double-check health, electricity, and other concerns before signing up for space.
Best Cloud Kitchen Business Strategies that work for everyone
- Single Kitchen, Single Brand, and No Storefront
- Multi-Brand Cloud Kitchen Business Model with Multiple Outlets
- Aggregator-Owned, Multi-BrandStandalone Cloud Kitchen
- Cloud Kitchen Chains
- Shared Cloud Kitchen
- Restaurant plus Cloud Kitchen
- Home Based Cloud kitchen
- Co – Working Facility Management Cloud Kitchen
- Super XL Cloud Kitchen
- Hybrid Model (Mixture or first and second)
- Managed Cloud Kitchen Business Model (Outsource Kitchen)
How to market cloud kitchen?
A cloud kitchen’s success depends on effective marketing and advertising. Marketing is much more important in a cloud kitchen because it is the only way to get orders. You can set aside money for marketing because you are not paying for a location or other upkeep expenditures.
Cloud kitchens benefit greatly from online marketing. The first step is to register your restaurant on sites like Zomato, Tripadvisor, Burrp, and others that list and review restaurants, and promote good ratings from your regulars. You can also use Facebook to promote special offers and discounts.
Pro and Cons of Cloud Kitchen
Best Tech Stack For Cloud Kitchen
When it’s about technology, two essential pillars are a significant part of cloud kitchens.
- Online Ordering Platform
In a delivery-only model, an online ordering app is the face of your business. It serves as the only way to connect your business with customers. So, from a profitability viewpoint, it’s essential to choose your own platform rather than working on commission-based third-party systems. For this, choose a reliable software development company in your area.
- POS & Order Management
Running a cloud kitchen means you cannot avoid integrating restaurant POS using different tools. It will make your cloud tech easier. Another biggest advantage is that it can bring parties using different third-party payment platforms.
There is a wide range of equipment required to run a restaurant kitchen. Some of them involve Ovens, Ranges and ventilation, Food processors, Mixers, Slicers, Food prep counters, cutting boards, Freezers, refrigerators, Safety equipment, Cooking equipment, Storage racks, and shelving, and more. Some of the cuisines require different equipment. So, create a list of equipment before investing in anything.
Licensing is a really important step, especially when you are starting a new restaurant. So, look for your state or federal licensing requirements. You can also consult with your fellow restaurant owners for more help. Bear in mind, you will make a list of all full-fledged operations so that nothing can stop your business.
Last but not least, people are the greatest asset for any business. Therefore, if you are not well versed in cooking, always hire a team of professionals. Experts can handle peak season pressure and still churn the order without compromising on quality.
Over to you
Now, we have touched almost every aspect of the successful cloud kitchen business. It’s your turn to start. Think about which cloud kitchen business model suits your needs, people who can think of business, how you can target Gen Z. we have also discussed how you can start a cloud kitchen business.