November 25, 2022

Ghost Kitchens: The Smarter Way To Open A Food Franchise This Year

Maximise your franchise restaurant’s success

Running a food and beverage (F&B) business isn’t easy, especially with high overhead costs and huge risks that make starting a F&B establishment hardly a worthwhile undertaking for many aspiring F&B owners. This concern has only been exacerbated in 2020, as restaurants took a huge hit during the pandemic. In India, restaurants saw a 90% reduction in sales after the lockdown, and India’s organised restaurant industry will see revenues plunge 40-50% in FY21. Restaurants were forced to halt operations, leaving F&B owners suffering  huge losses. 

This, together with the rise of the food delivery market, with projected market volume of US$71.63 billion by 2027, makes streamlining F&B operations toward fulfilling delivery orders the future of the F&B industry. 

Why ghost kitchens? 

How can food businesses streamline their operations for fulfilment delivery orders? The answer is ghost kitchens. 

Ghost kitchens – also known as virtual kitchens, cloud kitchens, or dark kitchens – differ from traditional dine-in restaurants in that the space and operations are optimised for delivery or takeaway orders. With the need of a front-of-house space eliminated, the rent and labour cost saved are just the beginning of the way ghost kitchens are made to turn a profit with the least resource possible.

The fantastic thing is that the risks are minimised, and therefore you can go all out and give your fantastic F&B ideas a go. This guide will tell you all about ghost kitchens, and the ease at which you can grow your F&B business by using ghost kitchen spaces, such as those provided by KitchenPlus.

5 ways ghost kitchens benefit F&B businesses

1. Save money on upfront and operational costs

The first thing to highlight is how much money you save by opening and running a ghost kitchen. The capital investment is minimal (₹5-10 lakhs) compared to the cost of opening a more traditional dine-in restaurant (₹1.5-2.5 crore). If you open a dine-in restaurant that doesn’t succeed, you can end up with a huge hole in your wallet or a significant debt to deal with.

In addition to the upfront investment savings, you’ll also save a lot thanks to ghost kitchens’ lower operational costs. You can save a considerable amount of money without all of the staff needed to run a regular restaurant efficiently, whether it be waiters, chefs, hosts, or even dishwashers.

While having quality staff is still extremely important for running a ghost kitchen, you can do so with much fewer employees. You’ll be able to focus on aspects that will make your food the best it can be. This may involve an investment in high-quality, attractive packaging for food that’s delivered to your customers’ doors, or higher quality ingredients. 

It’s all about efficiency with ghost kitchens. You’ll enjoy lower costs and higher margins as all of the extra liabilities of a dine-in restaurant disappear—like hefty rent payments, wasted food and other logistical brick and mortar costs—which means more profit for your business.

2. Faster ROI

After the COVID-19 pandemic struck, everyone in the F&B business had to move at lightning speed to accommodate the sudden and unexpected changes. Ghost kitchens made it possible to quickly set up a delivery-focused food business and enter new markets. 

Because the infrastructure is already in place and most of the logistics are taken care of for you, there are no frustratingly long waiting periods of construction or government paperwork approval before you can start your business. Your only necessities with a ghost kitchen are your chefs and basic equipment. You’ll be up and running within weeks. 

You can expect positive ROI to happen much quicker than it would with a dine-in restaurant. Within six months, most ghost kitchen owners break even on their investment—which is a considerably smaller time frame than the five years it takes with the traditional restaurant business model.

3. Increase your customer base online

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People are using online food delivery more than ever—and it’s a trend that’s not going away any time soon. In India alone, the food delivery business is growing and is predicted have a user penetration of almost 30% in 2022. All successful F&B businesses have an online presence, and if you don’t do the same, you’ll get left behind.

Chances are that your customers will find you by searching online, so you need to be there. And by focusing solely on delivery-only orders, your kitchen will be streamlined enough to fulfil food orders quickly and ready for delivery within minutes. When you meet a new customer’s expectations of quality food and fast delivery, you’ll end up with a happy, returning customer.

We at KitchenPlus have done all the necessary groundwork to identify the most profitable locations for India’s delivery-based businesses. With affordable rents combined with desirable locations that make you discoverable by online customers, you have the winning business growth formula.

4. Enjoy rapid growth

Ghost kitchens make it easy to expand into different locations very quickly. Every time you open a new food franchise, location logistics and rental leases are handled for you. This way, the process is quick without much stress or effort on your part. 

By implementing an effective strategy that applies to several locations at once, you’ll broaden your customer base and attract more food orders. And with most food order activity now taking place online, this process is easier than ever.

5. Partner with reputable third-party delivery platforms

Owning and operating a KitchenPlus ghost kitchen means getting instant access to all the latest technology you need to streamline your F&B business. 

Ghost kitchens rely on food delivery businesses to get their food to paying customers—and there are many food delivery services available in India, including Zwiggy, Zomato, Uber Eats, Food Panda and Faaso’s. With so many players in the game, keeping track of all these orders can get complicated. 

With KitchenPlus ghost kitchen, this isn’t a problem at all. One tablet lets you track and manage every order you receive, no matter how many food delivery partners you work with. Your only obligation is cooking the food orders and getting them prepared for delivery.

Ready to open a ghost kitchen?

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Our main goal at KitchenPlus is to drive innovation and create a new era of successful, sustainable F&B franchises. In such a fast-paced industry, it’s vital to be at the forefront to help delivery-centric businesses succeed. Are you interested in capitalising on India’s fastest-growing F&B business trend?

Don’t hesitate to contact us today by filling the form below. Our team experts are on hand to answer any of your questions!


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