WHAT IS A DARK KITCHEN?

Dark kitchen, ghost kitchen, blind kitchen, delivery-only or digital restaurant are the five names by which this new concept of kitchen is known, thought only to offer food at home and it is starting to be a trend in our country.

Other countries such as the United Kingdom and Singapore already have this concept very integrated in society and, in Spain, the intention is to follow this trend and implement this system in the hospitality sector. 

The way they work is through apps and / or webs of menu management and online orders both own and without commissions as Banzzu, or third parties with commissions as Uber Eats, Deliveroo, etc., most customers do not know that their food has been prepared in a dark kitchen.

In these ghost kitchens, tables, chairs and waiters disappear, to make room only for the team of chefs, assistants and kitchen helpers, but since there is no dining room, there is no wait staff. The closest thing to waiters would be the delivery men who, instead of serving the food at the table, take their vehicle and take it to the customer’s home.

In any case, this concept of cooking is neither clandestine, nor illegal, nor even less sloppy or dirty, since they have to pass all regulatory health controls. It is simply a kitchen that is not open to the public on the street, but is open to the online public.

This increase in home delivery in recent years, and especially given these last few months of pandemic, has given rise to this new concept totally new in Spain and is expanding very rapidly.

HOW DOES IT BENEFIT RESTAURANTS?

With the boom of online platforms, the face-to-face contact between the restaurant and the customer is disappearing. That’s why kitchens, more and more, must take advantage of cutting-edge technologies like the one offered by Banzzu and new marketing techniques to reach and keep their demanding public.

When it comes to costs, a dark kitchen provides much more flexibility and not having to have a room for diners, nor the need to hire staff to serve them, significantly reduces the cost from an average of 1 million euros to set up a traditional restaurant to only 14 thousand euros for a ghost restaurant.

This is why dark kitchens are apparently a way to get up and running while greatly reducing costs, and at the same time increasing the capacity to offer a wide range of services. 

Another key factor is business iteration and flexibility in experimenting with new menus, concepts or brands. By not having a physical location, you don’t have to “respect” the brand image or the type of food in front of your clientele. At any given time, if it doesn’t work, you can quickly change and start over.

However, when you automate processes and you work with many delivery companies it can be quite messy and difficult to control. That’s why many dark kitchens are opting to use proprietary software like Banzzu‘s, where they manage everything from one place: the online menu, incoming orders, delivery times, their users and their own statistics and marketing communications.

WHAT IS DRIVING THIS NEW CONCEPT?

The fact of having less free time, the increase in the search for convenience, the rise of the online world as a business model for any sector and personalized experiences; have influenced the way restaurants used to operate, transforming towards a digitalization starting from the kitchen, to the delivery.

Let’s take a look at the two biggest factors that have helped this transformation:

Technology

It was inevitable that so much technological evolution and desire to digitize and automate any process would not also reach the restaurant sector. For years now, we have seen how the e-commerce business model has risen and made an impact on society. We have gone from not trusting the online world and its payments, shipments, responses, etc. to consuming it on a daily basis. As we say, it could not be less with the hospitality industry. 

If I can operate with much lower costs and serve many more people, thereby substantially increasing revenues, why shouldn’t I take advantage of it? And all this is being made possible thanks to technology, both for the creation and subsequent modifications and updates of the menu; when it comes to making themselves known and building customer loyalty; when it comes to placing orders from specialized platforms; or when it comes to receiving and accepting orders. For all this, we continue to use Banzzu as an example, a platform that allows you to do all this and more; your own, without paying unnecessary commissions and in which your customers will be yours so that you can build loyalty and not third parties.

Millennials as the main customer

This type of consumer, those born between 1981 and 2001, have been driving the online market for years in almost all sectors and, as we have mentioned, it could not be less in the food and catering sector.

Millennials have grown up around technology and the convenience it brings and they are not going to give it up for anything. That is why the foodservice sector has to take a step forward in order to get used to them and not the other way around, to meet their expectations. In addition, this group of the population is beginning to be joined by older age groups who are increasingly demanding and knowledgeable about online service, and they like it.

This is where dark kitchens appear to offer exactly what this public is looking for and demands.

WHAT TYPES OF DARK KITCHENS ARE THERE?

Traditional” dark kitchen

It is true that the concept of dark kitchen has not been around long enough for this type to have earned the appellation “traditional”, but let’s say it is the standard and most widespread. It is a brand that has a single kitchen without a dining room. It is usually dedicated to a single type of cuisine and relies on online channels to place orders and delivery drivers to deliver the food to their homes.

Dark kitchen multi-brand

Several brands co-exist within the same kitchen, which greatly reduces operating costs. The success of this model is based on data analysis: to offer, according to the popularity and/or demand of each type of kitchen, what the public demands at any given moment and to market accordingly. 

Dark kitchen for Takeaway

This type is very similar to the “traditional” one, since it is the same but instead of home delivery, the public has to pick up the food at that venue. It could be seen as a hybrid between the traditional kitchen and the ghost kitchen and, in fact, it is what we are seeing now in many autonomous communities, where in many hours, it is the only way to enjoy the food from our favorite restaurants, going to pick up the food personally after placing the order “to takeaway”.

Dark Kitchens aggregator or marketplace

An empty kitchen space and sufficient infrastructure is offered so that several catering businesses can rent it. Like the company that rents office space, kitchens will now be rented out. These businesses take advantage of the number of businesses within their aggregator or marketplace and the online menu creation and ordering platform. 

This is why the owners and employees of these ghost restaurants, the only thing they have to worry about is what they do best, cooking their delicious food, receiving and managing incoming online orders. 

There may be several small kitchens operating within that large space. Multiple restaurants may be cooking at once at any given time.

Dark Kitchens PLUS Aggregator or Marketplace

This is a type of dark kitchen very similar to the previous one with the difference that in the same offer of “renting the space” more and better infrastructures and cooking process frameworks are included, fully optimized to give a premium experience to those who decide to rent this type of kitchen. For example, it could be that order management is included, so that the restaurant that rents this service only has to cook and with its fleet of delivery drivers make the deliveries.

Dark Kitchen outsourced to third parties

This configuration is the newest in the panorama of this business model and involves outsourcing almost any – or all – processes, except for the restaurant’s own touch. It is usually done in collaboration with other companies already engaged in food preparation and order and delivery processing and management. The final vendor or restaurant is only involved in the process of cooking the food.

Conclusions about setting up a Dark Kitchen

When it comes to setting up a ghost or virtual kitchen, you have to take a look at the different possibilities available in your area. Now, this is for sure: the dark kitchen business is not yet 100% defined and as the market progresses it will be modified and new ways of operating will be added.

Now let’s take a look at the pros and cons of setting up a fully online kitchen model:

Pros

1. Saving on the physical venue’s costs: you can save a considerable amount of money by not having to rent a physical building and having a presence in the center to give you visibility. In addition to equipping the premises well with tables, chairs, etc. and renewing it every so often when it becomes “old” or is no longer liked.
2. Saving on personnel costs: you don’t need to hire, train, manage and pay your team of waiters and waitresses.
3. Saving on time: it takes less time to set up a new ghost restaurant than a traditional one. From weeks in one, to months in another.
4. Saving on operating costs: you don’t need someone to manage so many finances, as it is not as complex a model as the traditional one.
5. Manage and follow the data: analyzing and managing your restaurant will be much easier, as everything is in the cloud and easy to find and consult. Goodbye to losing more paperwork, customers, suppliers, invoices, orders, etc.

“According to data from UBS, by 2030 food delivery will represent a $365 billion market. This represents an annual growth of more than 20% from $35 billion in 2017. It is undeniable, then, the weight that delivery has in foodservice. That is why from AECOC Foodservice Hub we have organized a new innoshot to know the opinion of foodservice operators, delivery companies and aggregators about the future of delivery in Spain.” — AECOC

Cons

1. Online visibility: the main challenge is how to make ourselves known to our customers if we do not have an open space for them to see us on the street. At this point, the use of social networks and digital marketing techniques will be very important to stand out and become a virtual fashion restaurant.
2. Customer loyalty: the interaction with the customer will be only virtual, so it will be more complicated to give that personal touch and maintain that relationship.