May 31, 2021, Innovations

Ghost kitchen – feeding on automation

Aneta Skoczewska Business Consultant

Ghost kitchen, also known as virtual, shadow, dark, or cloud, is a relatively new invention that emerged in the past two years and peaked in the times of pandemic. Although a kitchen run by ghosts seems like a great concept drawn straight from a Harry Potter book, the idea is slightly different. The name refers to delivery-only restaurants becoming a reasonable and preferred alternative to regular on-site places. What’s interesting, this XXI century revolution is estimated to evolve into a $1 trillion business by 2030! So, is it worth going for broke and investing everything you have in a virtual expansion? Can your brand live totally online and survive? Let’s take a little dive into the topic. 

Ghost kitchen definition – nothing to be scared of

Ghost kitchen is a facility for a fully virtual brand that doesn’t have its brick and mortar location. It includes a space, usually rented, suitable for preparing meals, an order automation tool, either in the form of a dedicated app or a voicebot answering phone calls, and a delivery service. 

Some of these places rely on third-party delivery platforms like Uber Eats or DoorDash, and focus solely on preparing meals for their customers. And the demand is quite huge. Although the trend started before the coronavirus, now, after long months of no access to actual restaurants, we can’t really imagine our lives without food served right in front of our doors. And moreover – ordered seamlessly with just a few clicks on the app or a quick chat with a bot. 

What should you think about before launching a ghost kitchen?

Because it’s a relatively new phenomenon, the territory is not quite uncharted yet. Nevertheless, setting up a ghost kitchen is still much simpler than launching a traditional restaurant. But before you throw yourself in at the deep end, there are some things you should consider first. 

1. Get the necessary knowledge

You may know the overall concept and that’s great, but it’s still not enough to go on with launching a new business. At this point, get as much information as you can, learn, study your competition, seek inspiration, and look for valid resources. A good start leads the way for your idea’s development. 

2. Create a tasty plan

You don’t really have to take care of the location and atmosphere of your place, because your clients won’t visit you to sit in. What you need to consider though is the food itself. Think about building a competitive menu with tasty, high-quality dishes that are equally delicious served in a paper or plastic packaging and after a respective delivery time. Maybe there’s some kind of niche in the area you want to work in? It lacks a good Georgian restaurant or a flavorus ramen? You have your concept then! 

3. Make room

You know that a ghost kitchen is not fully virtual, right? There has to be a place for a food preparation team – convenient, relatively large (depending on the group), well equipped, insured and ready for potential safety inspections. 

4. Don’t save on marketing

You did it! You have your own ghost kitchen ready to serve the most delicious food in the neighbourhood. It seems like there’s not much more to do, but serve it. Well, there have to be people to serve it to. Start using social media channels like Facebook or Instagram, run some digital ads focused on the area that interests you most, get a nice website with a menu, delivery options and other valid information. 

5. Provide an easy delivery system

It can be a website that enables placing an order via the internet, a cooperation with some of the delivery giants, or investing in a voicebot that’ll pick up the phone and collect the orders for you. 

It may all seem like a lot of work, but these are some necessary steps you need to take to last.

A ghost kitchen has some definite, flavorsome pros

There’s a reason why the concept of a virtual kitchen is so popular. It’s simply a good, profitable business to run. So, what exactly stands behind its success?

  • The overhead is pretty low – you don’t need fancy furniture, decorations, or a place in a hype location. You don’t even have to print the menu. A real estate that’s only business premises doesn’t need to be beautiful and refined. It’s enough that it’s convenient, regularly cleaned and properly adjusted to your staff’s requirements. 
  • You don’t have to wait long weeks before you open – you can rent a space with existing facilities and as soon as you have your menu and a team, you’re all set!
  • You are not dependent on the fast changing regulations – many restaurants suffered a fall during the pandemic, but the lockdown shouldn’t change much in the case of a virtual business. 
  • You can get as flexible as you like – a ghost kitchen has a crucial advantage of adapting quickly to both customer preferences and market conditions.
  • Possibility to rent a part of your space and earn more money – you can share your kitchen with other ghost brands and save on overall expenses. 

… and a possibly bitter aftertaste 

Well, it may not be so perfect after all, so you need to consider some possible cons, too.

  • Competition may be fierce – remember that you’re battling not only against other ghost businesses, but also regular restaurants with the delivery option. And this market is really huge.
  • Your delivery radius is quite low – you’ll probably operate in the area of 3-5 miles from your kitchen location. An opportunity to attract people from other cities is relatively unlikely.  
  • Top chefs won’t work for you – and you should just face it. There’s no way your kitchen will be known because of a famous name or a great reputation.
  • Third-party delivery platforms may devour most of your profits – the answer is investing in your own order placing app or a voicebot communicating through a phone channel.
  • It’s not that easy to keep your food in an intact condition – and only then will your customers repeat the order. You’ll have to take care of the proper temperature of the dish and its safety. You don’t want your customers to get upset, or worse – food-poisoned. 

So, is the cake worth the candle?

We won’t answer this question for you, but you have our input with all the pros, cons and preparation tips. Now, the decision is yours. 

If you’re not sure you’re ready, you can establish the area that needs support and contact our team. We can launch any app you need, prepare a web platform for your staff or clients,  and adjust a dedicated voice assistant to pick up your orders.