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You've probably done it countless times. You're craving a certain kind of, but you don't want to go out. So, you grab your phone, open DoorDash, UberEats, or some other delivery app, find a restaurant that makes what you're hankering for and order.
According to the Nation's Restaurant News, over half of Americans use delivery services to buy food from casual dining restaurants. Customers agree that it makes life easier by allowing them to have a good meal from the comfort of their own home.
While the rise of third-party delivery apps have given traditional restaurants another revenue stream, it has also driven the popularity of another trend: ghost kitchens. Instead of spending money on dine-in or takeout concepts, restaurants have reduced their costs by turning to a delivery-only model, sometimes with no physical restaurant at all, to sell their menu items.
But it's not only delivery apps that are making that possible for restaurateurs. Restaurant management, inventory, and accounting software solutions have made it possible for owners to experiment with multiple brands, food concepts, and business models using ghost kitchens and ghost kitchen software.
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A ghost kitchen is a professional kitchen space or restaurant that prepares food for deliveries only. There is no sit-down dining, and often no counter for takeout orders. They are also referred to as a cloud kitchen, dark kitchen, virtual restaurant or virtual kitchen.
A ghost kitchen facility is very much like commercial kitchen, and some may even operate out of a commercial space.
The popularity of the ghost kitchen concept has grown as restaurant tech and delivery apps become more sophisticated, creating a seamless experience for both restaurant staff and customers. To date, there are about 1,500 ghost kitchens in the U.S. Their market share was valued at just over $43 billion in 2014, and it's expected to rise to just over $71 billion by 2027.
Ghost kitchens, whose growth was driven by the popularity of the food delivery app and online ordering pre-pandemic, got a major boost from lockdowns as the restaurant industry was forced to rethink how they serve their customers.
Some restaurants have moved to the ghost kitchen model simply to save money, converting their menus to delivery only via a delivery platform. Meanwhile some big businesses have gotten in on the act, running multiple delivery restaurants out of a single shared kitchen that prepares food for each concept's menu.
Ghost kitchens are flexible establishments that can pop up anywhere, from vacant or -- even popular -- restaurants to grocery stores. Kroger grocery chain, for example, recently announced a partnership with Kitchen United to build ghost kitchens in their stores.
chains such as Five Guys and Wendy's have also experimented with the cloud kitchen model. In some cases, they allow restaurant operators to open a cloud kitchen operation using the restaurant brand without opening a traditional restaurant.
There are even ghost kitchen food trucks, virtual trucks that are optimized for takeout and delivery.
The ghost kitchen business model is attractive to restaurateurs for several reasons. First, it allows already established brands to expand their reach without taking away resources from their sit-down restaurant kitchens.
First-time restaurant owners, everyone from holding companies to individual restaurateurs see ghost kitchen as an opportunity to open a restaurant without having to raise capital to cover the high costs of overhead, waitstaff, and other FOH expenses.
Ghost kitchens also give owners the flexibility to open pop-up restaurants. They lease a space for a short amount of time to test out a market or a new food concept. If it works, they look to expand in their location.
Some restaurants are even using the concept of the ghost kitchen to run a virtual brand out of their existing restaurant business. A high-end steakhouse, for example, might run a burger delivery service out of their kitchen, throwing burgers down on the grill alongside their New York Strips.
Finally, many restaurants hit hard by the pandemic pivoted to ghost or cloud kitchen models to save their businesses. As lockdowns eased, they still found demand high for online ordering and deliveries.
There are, however, some disadvantages to running a ghost kitchen operation. Because there is no FOH and no storefront, so to speak, ghost kitchen restaurants have to put more effort into print and digital marketing. They can't rely on foot traffic or events that pull in customers.
In many cases, as Forbes points out, it creates a middle-man scenario, as well, where the customer doesn't have direct access to ghost restaurant staff or management. Conversations about food quality or dietary needs have to go through the online ordering system, creating something of a game of telephone.
And while a restaurant owner may not have to worry about waitstaff, they will have to factor delivery drivers, as well as delivery fees to the customer, into the equation. They will have to consider hiring staff or partnering with an third party delivery service.
Finally, a ghost kitchen operator has to stay on top of their digital menus, particularly if they're running multiple brands out of one kitchen. Kitchen staff have to keep food orders on brand and menus up-to-date as items change or ingredients run out.
Having the right tech stack, however, can help offset the disadvantages of a ghost kitchen. For example, site hosting services and digital marketing tools can help restaurants manage their online presence, from their website to their social posts.
Then, there are restaurant management software solutions, which will keep a ghost kitchen running smoothly and efficiently.
That food you ordered? You may not even realize you've ordered from a ghost kitchen. That's how seamless ghost kitchen software, also known as cloud kitchen software, makes the experience.
When you order your food, it shows up at the ghost kitchen, where a member of the kitchen staff takes each online order and runs with it. They check the recipe via a mobile device and get cooking, updating the delivery app as they go. When the order is complete, they hand it off to a driver, and off it goes.
At the end of the day, management updates the inventory and reorders depleted stocktake to be ready for opening the next day. They'll cross-reference sales via the delivery app or POS system with inventory to reconcile accounts, as well.
A good restaurant management tool helps staff keep track of inventory and manage the menu (or menus). MarketMan's cookbook feature, for example, allows BOH staff to create digital menus and recipe cards that kitchen staff can access via mobile, helping control quality and portioning.
Their inventory management tool, coupled with a POS system, will help you manage your stocktake, update quantities, and optimize the ordering process. Meanwhile, their pricing and accounting tools will give you insights into current food and vendor prices and manage your expenses to keep your restaurant in the black.
The convenience of food delivery services is in high demand, and restaurants are pivoting to meet customer needs. If that means starting or leasing a ghost kitchen, many establishments are jumping in with both feet.
And with the right restaurant management tool and POS system, and , a ghost kitchen allows them to experiment with their businesses in ways that simply weren't possible before. By keeping track of inventory and keeping costs low, a solid restaurant inventory tool gives restaurateurs the freedom to run their business in the most profitable way possible.
Talk to a restaurant expert today and learn how MarketMan can help your business