Cloud Kitchen Business Model: Everything You Need to Know
The growth of the online food ordering sector has created new business options for both established and new restaurants, one of which is the Cloud Kitchen business model. The Cloud Kitchen concept is a new food business ideology that has lately taken hold. According to a statistic, “The growth rate of cloud kitchen business is around 13.5% and most restaurant owners would want to open a cloud kitchen business”. This article will inform you about the basic concept and the types of models available to help you choose your desired one.
What Is a Cloud Kitchen Business Model?
A cloud kitchen refers to a centralized commercial cooking environment that gives food businesses the tools and resources they need to make menu items for delivery and takeaway. The cloud kitchen business model allows delivery-only restaurant that does not have a physical location where customers can dine. Moreover, there is no required fancy infrastructure, furniture, table, and waiters. The cloud kitchen business model can allow the customers to place their orders online through online food aggregator apps or restaurant websites. It is also known as a ghost kitchen or virtual kitchen.
Types of Cloud Kitchen Business Models
There are various types of cloud kitchen business model that exists in the present market. Without knowing the types clearly, you can not start your cloud kitchen business. Below are the primary models used in the industry.
1. The Independent Cloud Kitchen Model
The independent cloud kitchen allows single brand, single kitchen, and no storefront in this model. This cloud kitchen business model allows you to receive orders from multiple third-party apps like UberEats, DoorDash, and Grubhub. Thus, this is the basement of the cloud kitchen business model. In this process, you simply prepare your delicious food or beverage item, wrap it for travel, and place it at the front for the delivery driver to pick up and bring to your customer once you receive the order via the app.
Moreover, there is no required seating space and the physical store. Also, you can easily avoid the high rental and real estate costs by shedding the front of the house. Most significantly, this model is easy to operate and quick to serve. It does not require any additional cost and for that reason, it is being more popular day by day.
- Kitchen Size: You need around 500 – 600 sq ft.
- Working Process: Receive orders come from online sources, prepare food in the kitchen, and deliver food items via self-delivery or aggregator.
2. The Multi-Brand Cloud Kitchen Model
The multi-brand cloud kitchen allows multiple brands, a single kitchen, multiple outlets, and no storefront in this model. It allows to get the order through an app, prepare it, and have the driver deliver it to the consumer. The main difference is that you need to manage several brands from the same kitchen in this process. You might think of it as specialty cuisine cloud restaurants that are all owned by the same parent company and share the same kitchen.
The goal is to meet the demand for the greatest cuisine in a location with fewer possibilities for serving it, such as Biriyani, Chinese, Burgers, North Indian, Pizza, and Pasta. Most significantly, it is a clever cloud kitchen business model because you just need a single kitchen and you can serve multiple brands as well as outlets. You need to bear the low operational cost.
- Kitchen Size: You can build it according to your flexible size.
- Working Process: Receive orders from multiple online sources, conduct multiple brands/outlets focused on specific cuisines, and deliver food items.
Comparison of Business Models
| Feature | Independent Model | Multi-Brand Model |
|---|---|---|
| Brands | Single brand | Multiple brands |
| Kitchen | Single kitchen | Single kitchen |
| Storefront | No storefront | No storefront |
| Kitchen Size | 500 – 600 sq ft | Flexible size |
| Cuisine | Specialized in a cuisine | Multiple specialty cuisines |
