The returns in the online food delivery segment are projected to reach US$ 339,2573 in 2022.
Presently consider a restaurant model that exists solely to seize this market.
As customers shift their dining behavior increasingly to delivery, it’s impossible for restaurants to ignore the huge appetite for this new model. Indeed, even industry trends have started showing up in favor.
Let’s see how!
What is Cloud Based Kitchen Model?
Cloud kitchens similarly known as ghost kitchens or virtual kitchens are acquiring a lot of popularity nowadays. Cloud kitchen display system that receives orders, prepares food, and is out of delivery for respective delivery locations.
Delivery optimization is not a new idea in the food delivery market. However, as customers turn to on-demand meal delivery rather than visiting eateries, the delivery-only model has started to gain traction. Technology, alongside customer behavior, is a significant driving purpose behind the victory of the cloud kitchen business model concept.
Key Features of Getting a Cloud Kitchen Business Model
The interest and development of the cloud kitchen business model were a simple shock to numerous restaurants. Since expenses of the front house activities were decreased and people could focus on food.
Here, you can see a lot of benefits of this model, such as:
Minimal Real Estate Costs – When you’re planning to quit table reservation system for restaurants and offering a delivery-only service will make you save a large amount on real estate costs.
Cloud kitchen releases you from the requirement of having space in a high-visibility region. Rather than paying for availability, better-created complexes, or even an enormous parking spot, you can focus on having sufficient kitchen space in a decent area close to your target market.
Superior Expansion Opportunities – A good thing about cloud kitchen is that you don’t need to invest a huge amount to begin. You can begin small but expand quickly. When you build a brand and get loyal customers, extending to new localities and even new menu items gets easier.
For example, let’s take Faasos, presently it runs 180+ kitchens and multiple brands that include Faasos, Behrouz Briyani, Firangi Bake & Oven Story.
No Overhead Pricing – A cloud kitchen model allows you to save overhead costs. You don’t need client-facing staff, decoration or restaurant entrance, parking spot and so forth. Even if you have lower-estimated menus, your overall revenues are likely to be better.
6 Cloud Kitchen Business Models
Independent Cloud Kitchen Business Model – Single brand, single kitchen, no storefront.
This will be the original cloud kitchen model. An eatery with no dine-in space and no actual store. Restauranteurs or food business participants avoid high leases and real estate costs by shedding the front-of-house. These ideas acquired popularity with the development of online ordering and growing customer demand deliveries.
Multi-Brand (Faasos) Cloud Kitchen Business Model – Multi-brands, single kitchen, multiple outlets, no storefront.
The most complex cloud kitchens depend on data information, such as resident demographics, popular cuisines, and hyperlocal demand supply. The point is to meet the need for the most ordered food in an area ( around a 5-6 km radius) with a relatively lesser eatery option that serves dishes.
This is the clever cloud kitchen model since it depicts the various brand as independent entities. Moreover, having a separate kitchen will minimalize your operational costs. This approach is related to the original cloud kitchen model idea that there is no actual storefront, for instance, Faasos.
Hybrid Cloud Kitchen Business Model (FreshMenu) – Single brand, single kitchen, multiple outlets, storefront available.
This is somewhat a remix between a restaurant takeaway and cloud kitchen. It looks like a cloud kitchen business model for the major part, yet additionally has a storefront. The storefront exists to permit customers to walk in and see how food is being prepared. In essence, this model uses all the functional efficiencies of the cloud kitchen business model yet additionally has a “real” window with consumers.
(Swiggy) Access Cloud Kitchen Business Model – Aggregator owned, multi (restaurant) brand, rental co-working kitchens, no storefront.
This cloud kitchen business model is frequently known as “Shell” in the food business circles and is ideally located empty kitchen area with limited infrastructure. Initiating a new restaurant business lease that kitchen space, and utilize Swiggy’s online ordering, delivery fleet, and menu knowledge to set up a proper restaurant. The restaurant brings the equipment, employee, and recipes. Here, Swiggy plays an effortless role where the restaurant does the cooking and Swiggy wraps up.
Full Stack Cloud Kitchen Business Model (Zomato) – Third-party aggregator owned, multi (restaurant) brand, rental kitchens, with a storefront.
Zomato model, which is an enhancement fi Swiggy access approach, depends on the idea of rental kitchens but with built-in cooking equipment and broad processes. Zomato additionally offers its experience in order demand management in this manner. These cloud kitchens, similar to the FreshMenu idea, feature a storefront where customers come in. Like a FreshMenu model, a mash-up of a cloud kitchen, and a restaurant takeaway.
Outsourced Cloud Kitchen Business Model (Kitopi) – Cooking own and delivering completely outsourced
This is a moderately new concept in the cloud kitchen business model. In this model, you can able to outsource everything from your call community activities, to your kitchen, and delivery. Just imagine a restaurant where a greater part of the kitchen prep is outsourced and delivered to your kitchen. Your restaurant chefs can then do the last touches and Kitopi picks it up for delivery again.
All That You Must Know Before Building A Cloud Kitchen Business Model
On-demand food delivery services have taken control of the market today. A cloud kitchen business model is just like a strawberry on the cake. There are a few things you should consider before building this business model for food delivery services:
Going out to eat or cooking at home is becoming less enticing to millennials. Convenience is a major motivator in their decisions. Food delivery provides convenience, additional alternatives, and an increasing number of healthful selections.
The younger generation is more inquisitive and observant of their surroundings. They seek answers to questions such as where their food comes from, how many calories it contains, and whether it is organic or not. Brands must develop and coordinate their marketing for this level of awareness.
Demand For International Dishes
They are eager to try new things. Whether it’s via international cuisines or fusions of various foods. Millennials are crazy about Korean Tacos, Ramen Burgers, and Butter Chicken Dosas.
Experience is still quite valuable to these generations. However, it becomes difficult for restaurants to regulate it while performing the delivery. So, to improve your delivery experience, packing, and feedback discussions, pay more attention to those.
Over to You
The cost of developing an on-demand food delivery app is determined by a collection of criteria such as refined features incorporated, platform compatibility, hours of development, team location, etc. The development cost might range between $5000 and $10000.
A cost-effective alternative is to employ Foodesoft’s ready-to-use solutions. The solution has the benefits of customizability, functionality, and affordable cost.