BOO! Did we scare you?
No? Good. But, what about Ghost Kitchens – should you be scared of them?
What Are Ghost Kitchens?
All across the US, more and more restaurants are becoming “virtual restaurants” (also known as ghost kitchens). These restaurants are kitchen-only operated, and food is prepped for delivery or takeout only. This developing trend comes as no surprise as customers continue to lose interest in eating AT actual restaurants.
The Changing Restaurant Landscape
Increased demand for takeout and delivery is forcing restaurants to change their operations, marketing, and strategic plans.
In 2018, around 63% of all restaurant traffic was ‘off premises’, which is a growing percentage compared to previous years. To adapt, restaurants are opting for spaces, that under most circumstances, would go unoccupied as a “restaurant”. These spaces include small square footage rentals, malls, or special-use buildings specifically used by ghost kitchen operators like Kitchen United, zuul, and CloudKitchens.
This shifting landscape has benefited landlords and real estate owners since they can profit from renting these unusual spaces that would normally go unused. Restaurants also benefit, with the ability to operate in areas that might be out of their budget as a traditional brick-and-mortar location.
Benefits For Restaurants
There are several benefits for restaurants operating a virtual/ghost kitchen.
As a virtual restaurant, owners don’t have to worry about their storefront, maintaining their interior, and replacing plates and cutlery. When you think about it, these things can be distractions from what a restaurant really wants to do. Owners and/or chefs simply want to cook great, high-quality food and get it to as many customers as possible.
Instead of investing in traditional operational items, ghost kitchens can spend most of their time and money in testing new recipes, developing customer-loving dishes, and expanding their digital footprint to attract more customers. Additionally, ghost kitchens have a leg up on other restaurants in pricing their food at a more affordable price.
Digital Power Of Online Ordering
Online ordering and delivery allow customers to enjoy their favorite meals from the comfort of their home or office. Also, the costs associated with going out (transportation, parking, drinks, etc.) are avoided. Ordering online allows customers to experience the food from a restaurant, but without the full experience of the restaurant. With the click of a button, customers can avoid all of the headaches of dining-out. Online ordering makes it easy and accessible for ghost kitchen operators to access and serve local customers.
Challenges Of Operating A Ghost Kitchen
While all of this may sound like a dream to a restaurant owner, there are certainly challenges to operating a ghost restaurant.
Ghost kitchens remove the face-to-face exposure that is standard among normal restaurants. If a customer has a bad experience with your food, you aren’t able to receive that feedback in person and respond accordingly. This may result in a customer posting a negative online review. On the same note, if a customer has a positive experience, you aren’t able to receive that feedback as easily, and use it to your benefit.
By operating a ghost kitchen, the food represents you – the restaurant. As long as you can stand behind your food and give customers the quality and consistency they demand, operating a ghost kitchen could be a great fit for your business.
Regardless of type, starting a restaurant is a riskiest business venture – with 26% of new restaurants failing within the first year. While ghost kitchens won’t replace traditional restaurants, their growing prevalence is something to pay attention to – either as an opportunity or a threat.
A strong brand, customer experience, and high-quality food are still the most important aspect to any restaurant. That’s the most important thing to remember.