When you hear the term “ghost kitchen”, what comes to mind? For most, it’s an elusive and mysterious business model. But what is a ghost kitchen exactly, and is it right for your food business?
With the total foodservice delivery market for the UK worth over £8.5 billion and takeaway orders increasing by the year thanks to the rise of online delivery concepts, it makes total sense that your food business should also reap the benefits of this lucrative market.
We dig a little deeper into the booming virtual kitchen industry and determine which food businesses suit the ghost kitchen model.
So what exactly is the ghost kitchen business model?
Simply put, a ghost kitchen is a commercial kitchen that’s used primarily for delivery and takeaway orders rather than in-person dining. They allow businesses to outsource their food preparation and delivery without having to worry about maintaining a physical storefront.
Dark kitchens have numerous advantages over premises dining; foodservice businesses can use a ghost kitchen to expand their menu offerings, cutting out additional overhead costs. Plus, by using a ghost kitchen, these businesses can avoid the extra scrutiny that comes with running a full-service restaurant and can reach new customers without having to invest in additional physical space or staffing.
Ghost kitchen facilities can have 30+ individual commercial kitchens, with one central area for delivery drivers to pick up from. Some can host a variety of brands, virtual restaurants and individual commercial kitchens that are looking to expand their delivery radius. The food business is signed up to use multiple delivery apps to get customers ordering. Delivery platforms do most of the expensive and time-consuming leg-work when it comes to advertising and accelerating online orders.
Which businesses should consider the ghost kitchen model?
If you’re looking for a model that can help you scale your business, reach new customers, increase profitability and align with your personal values, the ghost kitchen model may be the right fit for you.
Let’s take a look at who will benefit from the ghost kitchen model…
Food delivery startups
The model of ghost kitchens for rent is an affordable way for aspiring restaurateurs to get their businesses off the ground. This model is an appealing option for those who want to open a low-risk food business and focus on expanding their customer base.
Food delivery startups who are strapped for cash can use delivery-only ghost kitchens to operate with a lower startup cost than traditional restaurants and can even be managed from home. With a ghost kitchen, you’ll be able to prepare and package your food in advance and then sell it through a delivery service or online platform.
By skipping the brick-and-mortar restaurant location altogether, your upfront investment will be more manageable than creating a brand-new, fully operational dine-in restaurant. In addition to reducing the square footage per customer, your business model can cut out costly expenses like front-of-house staff, furniture, decor and toilet facilities.
To make your food-delivery business profitable, you’ll want to focus on factors such as online marketing, branding, social media and menu optimisation.
Independent restaurant businesses adding a virtual brand or expanding their menu
Local businesses may opt for a delivery-only location to accompany their existing brick-and-mortar location. A virtual brand allows you to diversify your offering and reach new customers. It is ideal for restaurants that want to test new cuisines without having to commit to a full-scale launch and restaurants that want to expand their delivery or takeaway business without increasing their physical footprint.
Creating a virtual brand means using your current restaurant menu items, marketing channels and existing kitchen equipment, but under new branding, to test out a new concept without heavy investment.
Ghost kitchens have the convenience of streamlined delivery and low overhead costs, allowing restaurant operators and businesses alike to expand into more markets.
Food truck and street food operators looking to grow their business
Another business model that could benefit from a ghost kitchen is a food truck. Catering trucks and street food operators typically have to find a spot to park and set up each day, which can be difficult, costly, space inefficient, and, of course, weather dependent!
With a ghost kitchen, mobile food operators could simply prepare the food off-site at a centralised location with plenty of kitchen space and then deliver it to the customer. This eliminates the need for a physical location and gives their food business on wheels the freedom to move around and discover new, in-demand areas and scale up their business.
Restaurant chains improving efficiency at scale
As the restaurant industry continues to expand, restaurant chains are looking for ways to improve efficiency and scale at a lower cost.
Implementing the ghost kitchen model allows chains to open more locations without having to worry about additional overhead costs or space requirements of multiple kitchens. It also allows them to better compete with third-party food delivery platforms like Deliveroo and UberEATS and cater to in-demand areas. A central production unit is the best option to serve nearby locations while also producing meals for delivery.
Ghost kitchens are already popular amongst fast-food chains, but they’re starting to gain traction with traditional restaurant brands too, who are using the ghost kitchen model to maximise efficiency.
Catering companies reducing their overheads
If you’re running a catering company, then there’s a good chance you’re looking for ways to reduce your overheads. And for this reason, the ghost kitchen model is becoming increasingly popular amongst caterers, big or small, looking to start out or scale-up.
A catering kitchen has the adaptability and flexibility to suit your business requirements, allowing you to make your mark on the industry without breaking the bank.
Eco-minded food businesses
The ghost kitchen uses small-scale production methods that help to reduce environmental impact and carbon emissions. They are inherently smaller and subsequently have a smaller carbon footprint than a full-blown customer-facing concept.
Removing front-of-house operations, meaning fewer dishes to wash, fewer plastic straws etc naturally increases sustainability. And eco-friendliness is a key factor with the majority of today’s business owners and consumers.
Dephna is on-hand with the ghost kitchen model to help set your large or small business goals alight! We offer complete flexibility and 24-hour access with commission-free deliveries in any of our food delivery kitchens. If you’re interested in our commercial kitchen rental, enquire now to book a visit.