From photos to video streaming services, consumers prefer everything online these days. Even giant corporations have adapted the remote working and cloud-based business models. Similarly, a new digital concept of cloud kitchen restaurants has emerged in recent times.
If you are an entrepreneur thinking about entering the restaurant industry or a seasoned restaurateur wondering what a cloud restaurant is, this post is for you.
The Cloud Restaurant Concept Has Very Recent Roots
The cloud restaurant is a fairly new concept that requires you to operate a commercial facility with a single purpose to prepare food for home deliveries. Cloud restaurants are known by many names, such as ghost restaurants or virtual restaurants.
A customer uses an
automated ordering system to place an order. Restaurants receive the order, prepare the food and use a third-party food delivery service to get the food to the customer at their doorsteps.
You may think that there is nothing new about this because it sounds like a restaurant offering home food delivery. Well, you are right in some way. The concept of cloud restaurants does not need the restaurant owner to have a brick-and-mortar dine-in premise to serve visiting customers.
You can run a cloud restaurant from a remote location. All you will need is to rent a commercial kitchen, install your equipment, hire minimal staff to cook food, and you are good to go. If you are on a tighter budget, you can even share one commercial kitchen space with other cloud restaurants to prepare your food and deliver it.
Cloud Restaurant Business Models
Restaurant owners or entrepreneurs can adopt various approaches to run a cloud kitchen restaurant. You either start a delivery-only brand or add the facility to your existing restaurant kitchen. Let us explore the options a bit more in-depth.
Adding Cloud Kitchen Restaurant to an Existing Restaurant
If you want to see your restaurant revenue grow with the rise of online food ordering and delivering services, the cloud restaurant business model is something you must not ignore. Many restaurant owners are leveraging the cloud kitchen concept to add cloud restaurants to their dine-in restaurant model.
Start by adopting a cloud kitchen management software that allows full and convenient integration with your existing POS. Once set up, you will be ready to start taking online orders, prep the dishes, and send them out to the customers.
This approach will allow you to squeeze the most out of your existing equipment, inventory, kitchen space, and staff to earn extra profits. You will also be able to offer not just home food delivery but pick-up services also. This way, customers can order food on the way, and you will have time to cook and keep it ready by the time the customer comes in to collect the order.
Running a 100% Cloud Restaurant
This is a truly cloud-based kitchen, a consumer-facing model of the virtual kitchen that operates exclusively through the cloud. This means you will not have any physical front, shop, serving booth, food truck, or pick-up location.
However, you need to be either a licensed brand or a concept to run a cloud restaurant. The next step will be torent a commercial kitchen during your operational times. Partnering with food delivery apps is another important aspect. If you are a new restaurant, you will also have to streamline your labor, inventory, food suppliers, and ingredient ordering.
A Shared Cloud Restaurant
It comes as no surprise that there has been a boom in the food delivery sector since the rise of the pandemic. A cloud restaurant is one of the most innovative ideas to claim your market share with the least investment needed.
More and more entrepreneurs and established restaurant owners are renting kitchen spaces to one or multiple third-party brands. Think of it as a co-working space or incubator but with chefs of various restaurants working in the same kitchen, making their respective recipes. For instance, let’s suppose you order a pizza, sushi, and Indian curry from a cloud restaurant in your area. It is likely that all three food items were cooked in the same shared cloud kitchen.
The ghost kitchen might be using a centralized online ordering system, where all the orders come in at once, and respective brands cook their specific dishes. It is entirely up to you to decide which cloud restaurant model suits your needs.
The Benefits of a Cloud Restaurant Far Outweigh the Potential Constraints
Now that you know what a cloud restaurant is and the various models which may suit your needs, let us explore the benefits that outweigh any potential constraints you may be facing.
1. Low Overheads
One of the most challenging aspects of opening and operating a restaurant is the staffing cost and staying compliant with the local labor laws. Opening a cloud kitchen restaurant allows you to leverage more lenient on-demand labor. This way you can avoid worrying about the regular service staff laws.
The barrier to entering the restaurant industry through cloud kitchen restaurants is far lower than in traditional brick-and-mortar restaurants. Your ghost kitchen concept will incur lower expenses as you eliminate the need for any front-of-house or in-house operations, floor space to dine, high rents, furniture costs, and staff wages.
2. Improved Efficiency
You can use a custom-built kitchen space and optimize the process specific to your needs. Let us suppose you are running a cloud kitchen serving several brands simultaneously. In this case, you can prepare commonly used batches of ingredients used for different dishes and recipes. This will improve your efficiency and speed up the food preparation process.
3. Customer Satisfaction through Real-time Adaptability
Good online ordering software will provide you with reports on user data on customer behavior and buying patterns. This allows you to run an analysis and develop a solid menu with the best-selling items.
This will ensure that you are not wasting your time on low or non-selling dishes. Whatever you cook goes out immediately and guarantees a quick return on investment. This will also reduce your wastage cost and use of ingredients and inventory to an optimum capacity.
As you operate a cloud kitchen restaurant, this unshackles you from the challenges faced by restaurants with physical premises. As a cloud restaurant owner, you can change your menu or operation times at any time without the fear of losing walk-in customers.
A cloud kitchen concept is so adaptable that you can even launch a season-based cloud kitchen offering just seasonal food. For example, you may be starting a cloud kitchen from the Christmas season just cooking traditional holiday dishes and recipes.
4. Brand Awareness with Minimum Marketing Cost
Your cloud kitchen restaurant can gain quick and free exposure through social media platforms and delivery apps. All you need is to partner up with a delivery app, and your cloud kitchen will automatically get visibility to thousands of app users.
Similarly, you can create free business pages on Facebook, Instagram, and Twitter to engage with existing and potentially new customers. Even when paying for advertising on social media, you can opt for pay-per-click (PPC) ads, where you only pay when a potential user clicks on your food ordering ads.
You can even limit the advertisement budget on social media platforms and set requirements to target specific demographics such as age, ethnicity, location, profession, food taste, etc.
Cloud Kitchen with GRUBBRR
If you are a restaurant owner thinking about expansion for extra revenue, a cloud kitchen restaurant is something you must consider. We at GRUBBRR can help you streamline your online ordering and kitchen management with our innovative solutions. Please speak to our team today to discuss your needs!
