January 23, 2021
The ghost kitchen business model and off-premise brands may have been brought to light by the novel Covid-19 pandemic. However, it is a long-existing concept that's partly embedded in online ordering systems. Traditional restaurants started crossing into the digital market by creating websites and online marketing. Ordering systems and delivery options have also gotten better as more sectors shift to leverage modern technology.
Virtual kitchens were seen as a threat to traditional restaurants and off-premise brands were growing steadily. However, when the pandemic hit, forcing businesses to close doors in the wake of social distancing, online business models became the viable solution to business continuity. Ghost kitchen startups have since soared and promise profitability and success despite the hard times.
The ghost kitchen concept is relatively simple and involves replacing traditional restaurant dining experiences with online ordered and delivered meals. This phenomenon has been around for fast food outlets and the first ghost kitchen food truck existed long before the current crisis. However, ghost kitchens have taken up new meaning and refer to restaurants with a virtual brand with no brick-and-mortar location. Ghost kitchen startups don't always require a facility as you can rent one. You can also use ghost kitchens Uber services to facilitate meal delivery, significantly reducing the initial capital requirement. Nonetheless, food, labor and operational costs are still part of the business.
Ghost kitchens are off-premise brands that have no specific location. They operate online, so customers can complete all interactions on their PC or smartphone. Owners of ghost kitchens can use third-party applications, websites and dedicated mobile applications to provide an interface for customers to find their meals and complete an order. Each works differently, but the process is quite basic. Essentially, once an order request is received, the virtual kitchen will process it, package the meals and hand them to the delivery service. There are no physical visits or table reservations, as everything is completed online.
The advantages of creating a ghost kitchen, as opposed to traditional brick-and-mortar restaurants, are straightforward, especially during these challenging times. While news of a new vaccine comes with a promise of a return to normalcy, the impacts of the changes will last. People are likely to continue online ordering long after the virus, especially since ghost kitchens offer a unique opportunity for anyone to get delicious food.
Other benefits of becoming a ghost kitchen or virtual brand owner include low startup capital and operational costs, automation of the ordering process and affordable marketing mix. Ghost kitchen companies also have higher revenue potential as most people now order meals online. A significant fraction of the usual clientele (working class) works from home, increasing demand for home-delivered meals. What's more, there are no seating limitations, although this can translate into bandwidth, limiting the number of orders the virtual kitchen can process simultaneously.
There are more affordable digital solutions for these challenges compared to expanding a brick-and-mortar capacity. Ghost kitchens also come with the inherent benefits of an online business, including easy scalability, flexibility, convenience and swift operations. An off-premise brand seems like the ideal choice for most customers, especially with soaring cases of new infections.
Starting a virtual kitchen or brand requires a website or digital platforms, such as an app, an online ordering system, a delivery framework and various integrations. You will also need licenses and permits required to operate a food business. You can rent a meal preparation facility or purchase a ghost kitchen food truck. Next, you need to streamline the online ordering process and make sure it is convenient and straightforward. Uber eats ghost kitchen services can take care of deliveries.
If you have decided to start a new ghost kitchen, it is essential to complete due research to understand the business model, customers, competitors, operations and costs. Pricing and marketing strategies are also vital to ensure profitability. While an Uber ghost kitchen will likely be successful during these Covid-19 times, it is still important to deploy well-thought strategies. This comprises aggressive marketing, high-quality meals and exceptional customer support.
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