A cloud kitchen business can be compared to a restaurant that has no sitting arrangements but just the kitchen. Readers should not be confused about the term cloud kitchen. It is just a kitchen that can be set-up in any business location of your choice and the food prepared will be delivered within a range of 10-15 kms by the food delivery companies or a delivery person of the kitchen. That is pretty much what a cloud kitchen is all about. If you want to open in a small scale then you can open a single kitchen to serve a particular location but if you want to launch on a bigger scale then you may open up 2 or more kitchens to serve a wider location.
Just like a restaurant the cloud kitchen business model has to follow all Government designated rules and regulations like cleanliness, licenses, fire safety etc. This will help you to run the kitchen efficiently and make a profitable business out of it. A cloud kitchen mostly has a limited set of menus that are prepared fresh and distributed to customers who order them using the online food delivery apps.
A cloud kitchen has many advantages. One of them is the
requirement of fewer staff members. A cook and helper along with a cleaner is
the basic staff requirements when the owner himself is managing the overall
activities. The basic requirement of the kitchen is listed below if one is
planning to open up a fast food kitchen with items such as fries, burgers and similar
items on the menu.
One area where a cloud kitchen needs excellent focus apart from the food quality is the marketing of the business especially digital marketing. Facebook marketing may be the most effective in a local area as it will make the business visible to a wide audience. The second will be to promote the kitchen on the online food delivery apps that the kitchen plans to tie-up with. It is wise to tie-up with the most popular delivery app operating in the area.
The Facebook marketing will help to promote the business in the local market and target the right audience very specifically. Our primary objective is to generate orders as fast as possible for the kitchen and we will prefer to get more likes on our facebook page and keep our audience engaged with us. Regular posts about menu, customer reviews and any other important happening should be added daily.
In this digital age any business however small needs to have their IT systems in place. There are several QSR systems available on the cloud that can be deployed quickly. A fast food QSR system will enable to achieve the following at the very least.
· Expedite customer orders and decrease delivery times
· Track purchase orders and inventory analysis
· Create detailed reports in order to manage business effectively
In the ideal situation, the QSR system should be integrated with the delivery app software so that the orders served are updated automatically into the system.
Quality and taste of food are of paramount importance in this business. We have all seen how much we rely on the reviews in the delivery apps before ordering. Therefore, keeping a high review score on taste, quality and packaging will determine the success of the business. Just like any other business there is lot of competition in the cloud kitchen business. Also food aggregators demand higher commission from the cloud kitchens that dents the profit margin of the business. However, compared to a restaurant the cloud kitchen margins are higher. It can range around 15-20% EBDITA. However that will be dependent on the number of orders that you are doing per day and the average order value.
Since cloud kitchen is a new business model there are lots of ifs and buts. My suggestion to a local cloud kitchen would be to try a hybrid model of delivery wherein you hire a single staff on a per delivery contract and at the same time list on the delivery apps. This can give you some cost arbitrage rather than a full dependency on delivery apps. Also food should be prepared as much as possible as and when orders are received so that food wastage is kept to a minimum. All said and done, one needs to do a thorough due diligence on all aspects before putting money on the table.
If you are looking for a professional Feasibility study on acloud kitchen business write to us at info@intelligentq.co.in
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