Cloud Kitchens Remain on Cloud Nine
A cloud
kitchen, also known as a ghost kitchen, is a restaurant that operates online.
With the advent of cloud technology, these virtual kitchens shot to fame since
their first appearance in New York in 2010. There’s a concrete reason as to why
restaurateurs in the city chose this model while abandoning their original
brick-and-mortar businesses: Rent was skyrocketing. More recently, when the
Covid-19 pandemic hit, cloud kitchen space got even bigger with more brands
opening their subsidiary ‘delivery only’ kitchens. Again, there’s a reason that
why established brands launch their online kitchens other than expanding their
footprint: The food delivery industry is booming and it continues to expand
wings across continents. However, these established brands face challenges
operating these kitchens as they find it puzzling to manage two different
business models parallelly. The brick-and-mortar facilities are conventional
and these brands are not accustomed to running a ghost kitchen.
On the other
hand, individuals who run cloud kitchens have shown promising results. Let’s
analyze how running a cloud kitchen is a lucrative business. First things
first, location is not mandatory, wholly depends on online ordering mechanism
(that promises better reach), basic kitchen equipment will suffice, and minimum
staff requirement. With that said, no or less investment is required to launch
a cloud kitchen. However, there’s a small hitch that might play a spoilsport:
acquiring the license.
In addition,
the popularity of a cloud kitchen relies on how efficiently it collaborates
with third-party food delivery platforms, such as Grubhub, UberEats, etc. A
better reach is directly proportional to an increased number of orders.
In a nutshell,
launching a cloud kitchen is as convenient as ordering a meal online. Although
there must be proper research in place that going forward will play a vital
role in running the business effectively. In countries like India, cloud
kitchens are fairly a new concept. It takes just Rs 10, 000 to acquire the
license and start the business at any given place.
According to
Restaurant Times, “Licensing is an integral part of setting up a restaurant.
Few licenses are essential to procure in the first month of operations for a
hassle-free business. These are FSSAI license, GST Registration, Municipal
health trade licenses, fire licenses, etc. It is advised to hire an agency for
applying for all the permits because it is the most tedious and time taking
task. Apart from this rest of the permits would cost you around Rs 10,000 (if
the FSSAI license is applied for one year).”
The quote used
in this piece was extracted from the mentioned publication.