Ghost Kitchens are everywhere… You just can’t see them! 

Also known as dark kitchens or cloud kitchens, these hidden restaurants are highly efficient production units that are optimized for delivery. According to Allied Market Research, the global cloud kitchen market size was valued at $43.1 billion in 2019, and is estimated to reach $71.4 billion by 2027.

The primary difference between a Ghost Kitchen and a restaurant is that the site operates without a physical storefront. There’s no signage, no seating, no way for customers to access the space and no real clue that the business is even there. They rely entirely on a virtual, digital presence to sell their product exclusively to delivery customers.

When Covid-19 hit, a lot of bricks and mortar restaurant had no choice but to operate in this way. Many restaurateurs realised that moving onto a digital platform and offering a convenient option direct to the customer is a very lucrative model. And as more and more consumers turned to digital ordering platforms, the customer base expanded exponentially.

As more and more people order food online, a significant portion of these orders is facilitated through third-party delivery apps. The kitchen receives orders from Uber, Deliveroo, Just Eat or their own bespoke platform (sometimes all 4!) which are prepared inside the commercial kitchen space. Once the food is ready, delivery drivers collect it and it’s sent directly to the customer.


What are the benefits of a Ghost Kitchen?

Lower Rent – These kitchens tend to be in out-of-town industrial areas, or sites like commercial basements where rents are significantly lower. When you also factor in the reduced footprint from not having a customer seating area, these spaces can be a lot more affordable that a commercial restaurant premises.

Lower Cost of Service – No front of house staff and more streamlined operations means a much lower wage bill!

Flexible Concept – Delivery kitchens rely wholly on their online presence, and can therefore move quickly to a whole different menu or concept as customer trends change. Brands can easily experiment with menus and concepts to see what their local customer responds to.

Multiple Brands – It’s entirely possible to have two or three brands running out of the same kitchen. Say your core business is ‘Bert’s Burritos’ – you can also run ‘The Taco Shack’ and ‘Naughty Nachos’ alongside it, essentially giving you three brands in one! This also allows a business to target multiple segments or demographics at the same time – for example a vegan menu can sit alongside a core offering in a restaurant, but in a Ghost Kitchen a whole new 100% vegan brand can be created.


What should you be cautious of?

You’d be forgiven for thinking that location is less important when you take the traditional drivers of footfall and visibility out of the picture. You’re relying solely on your digital presence to raise customer awareness and generate orders.

However, when it comes to a delivery only model, keep in mind that in most cases the further your food travels, the more the quality will become an issue. More than three miles from the kitchen, and there’s a good chance you’ll jeopardise the experience of the customer receiving the product. Add traffic to the mix and location becomes

You also have a much smaller circle of potential customers – they cannot travel to you the way they travel to a physical restaurant, so be sure to research the local demographic and make sure your offer – and your price point – is correct. Your digital marketing becomes a critical aspect of your business, and branding, photography and copy have to work even harder to relay the concept to your target customer efficiently. And as more Ghost Kitchens open, it becomes more difficult to be seen.

Finally, unless you have an established app and delivery fleet, you become reliant on third party providers for the final stage of the journey. This come at a cost (up to 35% of sales with some providers) which makes your margins a lot tighter. And it doesn’t matter how exciting your website is, a poor delivery experience will directly impact your customer’s experience of your brand.


Are you thinking about branching out into Ghost Kitchens with your brand? Get in touch for a chat!


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