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How Cloud Kitchens are the next Big Thing in the Food Industry

The term “Cloud kitchen” is no newer to the world. With changing lifestyle patterns and the growth of online food ordering platforms such as Zomato, and Swiggy, demand for food delivered quickly has skyrocketed, and cloud kitchens have been set up to meet this demand.

Cloud kitchens have gained immense popularity in the past few years. According to research, India’s organized cloud kitchen industry is expected to reach $1.05 billion by 2023. These kitchens operate on a delivery-only model focused on delivering delicious food quickly.

So, if the term Cloud Kitchen is new to you and you want to explore everything about it, read this post. In this post, we’ll discuss how cloud kitchen will take the food industry to a whole new dimension.

So, let’s get started…

What Is a Cloud Kitchen and How Does It Work?

A cloud kitchen is a commercial kitchen that is used solely for the preparation of meals for delivery or takeaway clients. It does not offer a dine-in facility to the customers.

The other terms used for cloud kitchens include “ghost kitchens,” “dark kitchens,” or “virtual kitchens.” These kitchens are constructed exclusively for delivery. More often than not, these kitchens are located within a delivery radius of a significant number of online consumers.

In comparison to traditional brick-and-mortar operations, cloud kitchens enable food firms to make and transport culinary goods with less overhead. They are centralized, licensed commercial food manufacturing facilities where restaurants can rent space to develop menu items that are optimized for delivery.

Numerous restaurateurs employ cloud kitchens as testing ground. They either use cloud kitchens to extend an existing restaurant or launch a virtual brand at a low cost. This allows restauranteurs to expand their operations, explore new markets, or experiment with new concepts, among other things.

A single restaurant might have multiple brands or virtual restaurants, or the kitchen operator can act as an incubator, with various vendors sharing space.

Types of Cloud Kitchens

There are two types of cloud kitchen business models to choose from:

i. A shared space cloud kitchen. In this concept, restaurant owners employ their own employees and purchase their own produce, but the space and equipment are held by a separate entity.

ii. A dedicated space cloud kitchen. In this model, restaurant owners or brands rent a space or acquire one to establish a cloud kitchen. They may elect to use one or more other concepts in the location, but they don’t partner with other businesses.

A virtual brand runs out of a well-established kitchen, allowing the company to experiment with new ideas without incurring significant financial risk.

Reasons Why Cloud Kitchens Are A Next Big Thing

Another important factor driving the increased popularity of cloud kitchens, in addition to a shift in lifestyle, is the outbreak of COVID-19. According to studies, the number of commercial kitchens will continue to expand as they become more convenient for both consumers and employees.

Cloud kitchens are popular among consumers because they offer the convenience of delicious meals while remaining safe and secure.

Here are sever most common reasons why cloud kitchens are the restaurant industry’s future.

#1. Increased Per Capita Income

With the increased per capita income, more and more people are now willing to order meals or dine out. According to research, over 60% of millennials order meals from a restaurant or dine out at least once a month and are continuously on the search for excellent and delectable food.

Unlike the typical audience, they are not content with the status quo and prefer to experiment with the meals they order.

#2. Changed Lifestyle

In contrast to previous generations, there are more persons employed in an Indian household nowadays. With both male and female family members employed and the dynamics of daily cooking changing as a result of tight schedules, work pressure, and other considerations, ordering food online has become the most convenient alternative for everyone.

#3. Low Initial Investment

The best thing about Cloud Kitchen is that the initial investments are low. You don’t need to invest in real estate or pay a premium for renting space in a high-traffic location with cloud kitchens because you do not need to attract customers to your site.

Additionally, there is no need to invest in outdoor signage, interior restaurant decor, or other extras such as furniture, dishes, or cutlery. With cloud kitchens, all you have to worry about is the food you’re providing and its safety.

#4. Exponential Cost Savings on Investment

The cost of setting up a brick and mortar restaurant has increased multiple times over the years due to a variety of variables, such as the cost of renting a good site, infrastructure, and labor expenditures. However, profit margins are declining due to intense rivalry in the Indian restaurant business.

Moreover, over 60% of eateries shut down their operations within the first year. This has prompted investors and aspiring restaurateurs to investigate alternative investment alternatives that are both risk-free and profitable, all of which are met by cloud kitchens!

Research indicates that two out of every three restaurateurs in India who own a dine-in restaurant are considering investing in cloud kitchens rather than constructing a traditional brick-and-mortar location. As a result, cloud kitchens have had a significant impact.

#5. Fast Delivery

Unlike dine-in restaurants where customers need to wait in line during peak lunch and office hours, cloud kitchens process delivery orders remotely and promptly.

#6. Consistent Service

Cloud kitchens provide the same service since they operate under numerous brand names and provide a variety of cuisines under one roof.

#7. Software Solutions

The advent of software solutions, such as Recipe Management Software, makes restaurateurs automate their food preparation process, ensuring consistency in the quality and quantity of food produced while also giving you a competitive edge in the market. Aside from that, they can also automate their procurement and inventory management procedures with a Supply Chain Management solution to have a better understanding of wastage, food costs, and material stock.

Since time is critical in cloud kitchen operations, point-of-sale software comes in handy. Restaurateurs set up a POS (Point of Sale) in the cloud kitchen to process any online orders. This facilitates the administration of consumer orders in a streamlined manner.

Wrapping up…

The cloud revolution is just getting started and if you are planning to start a cloud kitchen, then now is the time. Having a cloud kitchen can help you make a significant difference in the food industry without spending a fortune on the establishment!

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