An increase in the penetration of the internet has led to a drastic rise in the potential of virtual restaurants or ghost kitchens. Most customers emphasize both convenience and quality. These are services a virtual restaurant can provide with ease, provided it’s set up on the right principles and follows the recommended steps to serving its patrons. Purely delivery-based food businesses are on the cusp of explosive growth and are expected to gross over 300 billion dollars in revenue by the end of the decade. If you’re thinking about starting a virtual kitchen or restaurant, now’s the best time to begin. Read on as we discuss what exactly goes on in a virtual restaurant, the advantages of the business model, and selecting the right equipment to support your business goals.
What is A Virtual Restaurant & How Does it Work?
Virtual restaurants are commercial food businesses that do not have a dine-in space, and instead make their sales solely using online platforms and third-party food orders & delivery applications. Business owners can set up a commercial kitchen in a dedicated space placed in a strategic location to serve their customers using either their own delivery services or a third-party provider. The digital food market is seeing steady growth and is even outshining dine-in models. Several businesses have noticed the potential in this new approach. With the rise of convenience and the ease of buying high-quality food with a few clicks on a phone, even existing dine-restaurants are setting up ghost kitchens to make the best of the current market.
The Advantages of Setting Up A Virtual Restaurant
The core benefits of operating a virtual restaurant include:
Low Overhead Costs
Virtual restaurants require only kitchen staff and delivery agents. The relative cost, when compared to dine-in restaurants, is far lower due to the minimal number of staff involved in the operation. The business model also helps you save costs on furniture, decor, interiors, dinner & glassware, and the upkeep associated with these components. Most of your expenses will be utilized for procuring commercial kitchen equipment and marketing your brand.
Convenient Online Delivery
Before the advent of online food order and delivery, restaurants offered takeaway services over the telephone. This system was prone to inefficiencies and could result in incorrect orders. With the proliferation of internet-based commercial food services, the ordering process is simple, convenient, and most importantly – efficient. Customers can access your restaurant’s entire menu with a single click or swipe, and even customize dishes to their liking. Food delivery services are optimized across devices and can be accessed on phones, laptops, or tablets.
A brick-and-mortar eatery is expensive due to the wide range of expenses it incurs. Paying for upkeep, rent, furniture, and accessory services is not an option for many aspiring business owners. Virtual kitchens on the other hand allow you to operate with the bare minimum, and still make a rather large margin of profit. By creating an efficient ordering system, you can also track your expenses and earnings in real-time, allowing you to track your establishment’s profitability while you’re at it. This also helps you make adjustments to your business model in case you’re incurring additional expenses.
A virtual restaurant offers broad flexibility to restaurateurs in several aspects. The online ordering system can easily be tweaked to change your menu immediately in case you realize you’re out of a few ingredients. Irrespective of how busy an operation you’re running, you can take an item off the menu within seconds using the user-friendly features of an ordering system. You also have the ability to serve locations wherever there’s demand for the food you offer since you’re not tied to a physical location.
Innovation & Experimentation
Because the costs of operating a virtual restaurant run lower when compared to a conventional restaurant, you have the freedom to experiment and innovate. You can offer unique items and test them out before you make them a mainstay on your menu. The opportunity to create unique food concepts and offer them to niche markets is another added benefit when your delivery patterns are emerging. You can make use of your sales statistics to identify products that sell, and those that don’t to help you make better decisions.
Choosing the Right Equipment for Your Virtual Restaurant: Should You Buy New or Used?
An important decision you will have to make when starting a virtual restaurant is the kind of equipment you want to buy. Since you save money on operating costs, labor expenses, and upkeep, most of your money will be allocated to procuring quality equipment. Since you will still run a commercial kitchen, your operation requires equipment like refrigerators, commercial ice maker machines, ranges, fryers, vents, food processors, and food storage equipment. While new equipment offers advantages such as warranty plans, insurance, and reliability, they’re also fairly expensive. On the other hand, used equipment is fairly inexpensive, but it comes with its caveats that include – limited or no warranties, risk of breakdowns, and having to pay for their repairs. Be sure to evaluate your finances, the machines you would prefer buying new, and the pieces of equipment you would be willing to lease or buy refurbished models of.
Cloud kitchens or virtual restaurants are great ways of expanding your revenue and making an impact on the market. While making a fraction of the investment when compared to a conventional brick-and-mortar restaurant, you have a large market to cater to. The business model offers a lot of wiggle room for culinarians and also enables you to explore your skills to their full potential. Virtual restaurants are bound to grow further in market size, and if you’re thinking about setting out on your own ghost kitchen journey, now’s the time.