Ghost kitchens, dark kitchens, cloud kitchens, and virtual restaurants – nowadays, they’re everywhere.
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But are these restaurant business models here to stay, or just come-and-go gimmicks, destined to disappear without a trace?
To answer this question we need to first look at the basics:
How do these restaurant models differ from one another and how do they compare with traditional restaurants?
From virtual restaurants to ghost kitchens – terminology
What is a ghost kitchen?
They’re professional facilities adapted for the preparation of delivery-only meals. The facility accommodates space designated for meal preparation, kitchen equipment and supplies. Since this model focuses exclusively on food delivery, it has no dining area. This allows restaurant owners to save money on real estate expenses and staff wages. This solution is also feasible for restaurants willing to run another brand from the same location.
What is a dark kitchen?
Dark kitchens, also known as a cloud or ghost kitchen, focus solely on delivery-only orders. Dark kitchens also allow for pick-up orders, so there is no need for dining space or waitstaff. Additionally, restaurants that follow this business model don’t have to rely on their location for success. So how can a dark kitchen be successful? Simple – with effective marketing campaigns and delicious meals.
What is a cloud kitchen?
Cloud kitchens are the same as dark kitchens and ghost kitchens. Meals are prepared on-site and are delivered or picked up by clients. As a result, business owners don’t have to worry about expenses related to dining areas and having to pay waitstaff. That means cloud kitchens can operate in less exclusive (meaning less expensive) locations, as visibility, accessibility and foot traffic are not essential for this business model.
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What is a ghost restaurant?
Ghost restaurants operate similarly to the previous business models in that food orders are delivered to clients and are usually made via online food ordering systems like UpMenu or by phone. Despite the similarities, ghost kitchens and ghost restaurants differ from one another. Although both are centered around the food delivery model, ghost restaurants usually make meals for their own brand, whereas ghost kitchens can prepare meals for various brands all from one kitchen.
What is a virtual restaurant and virtual brand?
Virtual restaurants are another name for ghost restaurants. Virtual brands on the other hand are food businesses that exclusively sell their meals online through a food ordering website like UpMenu, mobile apps, or 3rd party online platforms. Restaurants simply create their virtual brand that’ll only be available online, and will prepare meals on-site.
Ghost kitchen vs ghost restaurant
So how exactly do ghost kitchens and ghost restaurants differ from one another? A ghost restaurant tends to focus on a single food service brand, usually one cuisine type. Ghost kitchens on the other hand support multiple restaurant concepts, which are also called virtual brands.
How does a ghost kitchen work?
The basic idea behind ghost kitchens is to provide customers with the best possible food quality for the least possible cost.
By ditching the standard storefront strategy and focusing on delivery and pick-up orders, there’s no need for a designated dining area and facilities. As a result, an the business owner can save on realty costs and employing waiters.
Although on-site dining restaurants have been the go-to business model, online food ordering has been rising at least 20% every year. With this in mind, the ghost kitchen model has this at its core.
What are the advantages of a cloud kitchen?
One of the most substantial advantages of running a cloud kitchen business is being able to maintain a number of restaurant brands from one location. This allows you to expand your potential customer base without having to invest in additional premises.
You can successfully host a number of virtual brands that represent different cuisine styles made from the same basic ingredients, all from one location.
Stronger focus on food quality
Since this business model isn’t concerned with clients dining on-site, you can focus all of your efforts on providing clients with finger-licking good meals.
Initially, this business model focused on small restaurants looking to expand their delivery capabilities, but many nation-wide brands (Wendy’s, for example) adapted it to relieve their brick-and-mortar locations in traffic-heavy areas.
Reduced wait times with storefront-free kitchens
Opening a ghost kitchen in busy areas is a great way to reduce the average wait time. After all, the closer you are to the customer, the faster you will be able to deliver ordered meals.
Many experts state that time is an essential factor for a customer seeking to order food, and most will choose earlier delivery over quality.
Safer expansion with a dark kitchen
A dark kitchen makes expanding to a new market easier and safer because of modest upfront costs, which make expanding less threatening to business finances. Having a smaller team is also easier to hire for a separate location, and the absence of a dine-in area reduces interior design costs.
Lastly, you can rent space in less desired areas to decrease real estate spending. Ghost kitchens provides an excellent opportunity to acquire new sales channels, without committing to a full-scale eatery.
You only need a premises with proper kitchen equipment, a team of chefs or cooks, and facilities to start your cloud kitchen. You can rent a workspace at specialized facilities like Cloud Kitchens or Kitchens United. Moreover, you can easily set up your own food preparation site at the rented premises, home, or food truck.
Lastly, you will need to hire kitchen staff to maintain food production and acquire sales channels to collect orders from customers.
Sales channels for restaurants
You have several options for getting for orders from clients, which include:
- direct phone calls or text messaging
- 3rd party online ordering platform
- online ordering system on the website
- mobile app
Direct phone call and text messaging
This option seems to be the easiest to implement. All you need is a work phone assigned to receiving phone orders from clients. And that’s exactly the worst flaw of this method. Phone ordering is time-consuming both for you and your customers.
Additionally, this method is prone to human-induced mistakes. A typo, confusion or static interference while on a call can cause credibility crushing mistakes for your business.
3rd party online ordering platforms
In recent years, online ordering platforms (like Grubhub, DoorDash, etc.) have sprung up and claim to raise the number of orders by even 20%, but at what cost? Despite the increase in orders, commission fees can eat up to 30% of an entire order, thus reducing how much you earn.
Furthermore, when restricted solely to the food ordering system, you lose control over your online presence. When this happens, your brand gets placed on the 3rd party sites, and is entirely out of your control.
Online food ordering systems
fully-featured online food ordering systems are the best solution for your restaurant. Thanks to integrated systems, you’ll be able to conveniently receive orders on any device. Additionally, as you have total control over your website and published content, you can gain better internet visibility, which means more clients and more revenue in your pocket.
Better placement in organic search results will also drive more customers to your brand. Furthermore, you can set up an ordering system with ease in just 5 minutes.
Mobile apps have been on the rise in recent years and provide a great way to attract customers. An easy to use and downloadable mobile app can help clients better familiarize themselves with your brand. And best of all? UpMenu lets you customize your own food ordering app, so clients have it easy when ordering their favorite meals, and you’re not stuck paying huge commission fees. Order and customize your own app with UpMenu’s free trial account.
Cloud kitchen during coronavirus pandemic
The cloud and dark kitchen trend came to life during the peak of the COVID-19 pandemic. Social distancing regulations and nation-wide dine-in restrictions accelerated the customer shift to food delivery orders. According to NPR, this trend is going to continue to rise, which will grow online ordering revenue from $27B to $240B by 2024.
Some experts state that cloud kitchen brands have worked better during the coronavirus crisis – however, that isn’t necessarily the case. Storefront-free kitchens don’t require the additional costs brick-and-mortar locations have to pay, but also wait times for food are cut in half, since all orders are delivery only.
Are cloud kitchens the best way to start a restaurant?
Although there are many great benefits to the ghost kitchen model, there are still a few drawbacks. The absence of a storefront means no additional marketing value – marking is solely focused on your meals. Also, when advertising online you compete with a wider selection of brands than you would be selling from a brick-and-mortar location.
To get ahead of the competition, utilize marketing tools that come with online ordering systems. Use push notifications, e-mail marketing, and SMS campaigns to communicate with customers directly. Utilize promotions and coupons to draw in new clients, and analyze initiated actions to determine the best course of action.
Cloud kitchens are a cost-effective business model, ideal for new food concepts, if you’ve got marketing down.
How UpMenu supports ghost kitchens?
You’re thinking about opening a ghost kitchen. You looked over all the pros and cons of this business model, handled the rental and furnishing of the preparation site also hired the necessary staff. What now?
Focus on attracting clients. But how? E-marketing is the answer. Online promotions are the key element for a ghost restaurant brand since they don’t have a physical storefront.
But is that also a huge flaw? Not necessarily. People tend to spend almost 30% of their day online, which exposes them to a number of ads. Creating an online presence should be your first main goal for your ghost kitchen.
How to build a responsive restaurant website
Creating a website on your own can be quite challenging and time-consuming. Sure, there are plenty of website-creation tools that can assist you, like WordPress, Squarespace of WiX. However, they’re not designed to get you more food orders and new clients.
But with UpMenu’s online food ordering system, you’re able to attract new clients, increase food orders, track revenue, and design your own food ordering app for easier ordering.
Why you should choose UpMenu for your ghost restaurant?
UpMenu uses the best WordPress restaurant themes with an in-depth website-creation tool to create astonishing user-friendly restaurant pages. All templates are created with high optimization and responsiveness in mind.
UpMenu also provides you with effective marketing tools like promotion engine, loyalty programs, and advertising campaigns. And if you need to send a direct message to clients, opt in for UpMenu’s push notification messaging to communicate with customers and send your interactive menu for instant online food ordering. Furthermore, these tools help boost sales through your website and enhance its position in organic search results.
Moreover, UpMenu’s online ordering system has a quick and simple setup process allowing you to start selling right away.
How to start a ghost kitchen with UpMenu?
Here are the steps to make UpMenu your ghost kitchen’s #1 sidekick:
- Create an UpMenu account
Sign up at upmenu.com for a free 7 day trial – no credit card required.
- Select a theme for your website
Choose from 20+ different menu templates and 15+ different website layout designs that fit your brand. Additionally, you can customize templates to create a layout that matches your brand identity.
- Create an online menu for your virtual brand
Add your menu and separate it into different product sections.
- Set delivery zones
Use the map to set specific delivery zones. This shoes clients where you’re able to deliver their meals.
- Configure and order your mobile app
Your mobile app is an extension of your business that gets you more views and enhances the customer experience. Add your logo, choose colors, menu layout and place your order. Next, UpMenu will publish your mobile application on AppStore and Google Play in a matter of days.
- Create a new website or install online ordering on an existing one
- Start receiving orders
Receive online orders via any web browser or by a dedicated mobile app.
- Congratulations, you’re in the game!
Your customers can now place orders online on your virtual restaurant website or mobile app.
You’re now ready to start taking online orders, promoting your restaurant, and running things your way. What’s next?
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