The COVID-19 pandemic has brought about many changes, with the ghost kitchen concept being one of the most popular and well-known.
Necessity is the mother of invention. When restaurants, kitchens and brick-and-mortar dining spaces were forced to limit their capacity or close down entirely due to government restrictions, ghost kitchens helped keep many restaurants afloat.
With their modest kitchen space, variety of virtual brands, and food-delivery-focused business model, the ghost kitchen concept has helped many restaurants eliminate traditional restaurant spaces.
Many of these so-called virtual kitchens or virtual restaurants have partnered with third-party delivery services such as Uber Eats and Grub Hub to service their customers.
However, the rise of the virtual restaurant could mean the demise of brick-and-mortar ones.
What is a Ghost Kitchen? What Are the Benefits?
Ghost kitchens, also known as virtual restaurants, are kitchen facilities that cook food without a brick-and-mortar location. Often, these ghost kitchens host multiple brands under one kitchen space.
In a nutshell, ghost kitchens are restaurants that serve various food to be delivered elsewhere, usually via a food delivery service or another a third-party-delivery app.
Ghost kitchens offer a variety of benefits for restauranteurs and entrepreneurs. In addition to requiring substantially less startup capital than brick-and-mortar restaurants, ghost kitchens can operate on a skeleton crew of essential kitchen staff.
A ghost kitchen can optimize its inventory and stock by removing its front-of-house staff and expenses to handle many virtual brands and types of cuisines at once. One kitchen might offer one menu one week and pivot to another the next to better adapt to the market and their customers.
One San Franciso ghost kitchen, for example, was able to serve fried chicken, burger and wings, and ice cream – all from one location.
Another benefit that ghost kitchen brands have is testing a food concept or product before officially taking it to market. Ghost kitchens can test-run multiple brands and reach a broad audience relatively easily and quickly.
As more and more consumers embrace the convenience of food delivery services and apps, competition within the industry and restaurant space as a whole is becoming increasingly fierce.
While consumers and ghost kitchen restaurants win big, it’s brick-and-mortar restaurants that suffer the most.
How the Ghost Kitchen Concept is Killing Restaurants
Aside from the tourism industry, no other space has suffered as much as the restaurant industry from the COVID-19 pandemic.
Forced to either limit their capacity or close completely for months on end, often without warning or any plans in place, many restaurants struggle daily to stay open.
Traditional restaurants depend on consistency for their inventory, staffing and food preparation. Unlike ghost kitchens, a brick-and-mortar restaurant cannot pivot its menu at a moment’s notice or serve multiple types of cuisine at once to entice more customers or capture a larger market share.
In addition to food, staff, and equipment expenses, a restaurant must also pay to rent out its physical locations.
Faced with so many challenges, many restauranteurs were forced to either permanently shutter their doors or adapt to new customer expectations – the demand for delivery and takeout convenience – often facilitated through food delivery apps such as Uber Eats and Doordash.
However, it’s the food delivery apps and services meant to save the restaurant industry that will ultimately destroy it.
Predatory Practices
In a study published by the American Economics Liberties Project, researchers point out how third-party delivery apps use predatory practices to bully and coerce restaurants into partnering with them.
These services charge restaurants exorbitant fees to list restaurant brands on the app, charge large commissions on order processing, and additional costs to deliver.
Smaller, local restaurants that are mandated to close down in the pandemic’s wake often have no choice but to give in to the demands of these apps just to stay solvent. Without open access to similar platforms, a large customer base, and a fleet of drivers themselves, restauranteurs are forced into joining the monopoly of food delivery groups to serve their meals.
Ghost Kitchen Abuse of Dominance
Ghost kitchens are flexible. Their success is partly because they can pivot quickly to capture whatever food trend or fad is popular at the time. As we’ve mentioned above, a single ghost kitchen can serve multiple brands under one roof and location, all without allowing customers the option of dining in.
However, this in and of itself is not a problem. Ghost kitchens turn truly abusive when they begin to saturate the space with multiple virtual brands and essentially the same listings.
Ghost kitchens can list their restaurant multiple times and at multiple locations under different company names on a food delivery app. In this way, a virtual kitchen can essentially dominate and shove out the competition due to sheer saturation. On food delivery apps, one kitchen might have to compete with upward of 20 ghost kitchens.
Conflicts of Interest
In theory, ghost kitchen brands are virtual restaurants established by independent restauranteurs to test their menu’s proof-of-concept. In reality, food delivery services themselves are hosting their own ghost kitchen brands.
Cloud Kitchens, a Los Angeles-based ghost kitchen brand founded by the creator of Uber, is able to vertically integrate its services directly into food service delivery apps. By collaborating directly with the platform, ghost kitchen brands like Cloud Kitchens can collaborate with delivery apps to snuff out the competition.
What Can We Do to Help Local Restaurants?
A restaurant is more than just a kitchen space serving food – it’s an experience, an adventure, an opportunity to transform the act of eating into a ritual. While intriguing and convenient concepts, ghost kitchen concepts and food delivery are only an imitation of the restaurant experience.
There is no shared experience, no discussion over a delicious meal, no service. Ghost kitchens are focused on churning out fast, accessible food with wide appeal, not meals.
Customers today might covet the convenience that a ghost kitchen can offer but if action isn’t taken to stop the predatory behaviour of these virtual kitchens, there’ll be no restaurant left to sit down and have a meal in.
The value of convenience cannot be overstated. The rise of food delivery apps, same-day delivery services, and expedited shipping options all speak to the desirability of these services.
However, the desire for convenience is the reason why ghost kitchens manifested in the first place.
Want takeout from a restaurant? Consider calling them directly. Better yet, call and see if they have their own delivery service. Ordering directly from the restaurant ensures that they’ll see all the revenue. Plus, it’ll also reduce their dependence on food delivery services.
Food delivery services are notorious for exploiting workers from the gig economy in order to make their deliveries. These services often offset their expenses by passing the costs on to consumers and relying on tips to pay their delivery workers.
Instead of buying into the ghost kitchen concept, consider visiting in person to pick up your order. You’ll save more money and your local restaurant, all while supporting your community.
How to Support Local Restaurants with Cantec Couriers
Another way to help local restaurants is to have your meals delivered through Cantec Couriers.
Unlike food delivery services, our courier service does not charge commission off of a restaurant’s revenue. We also don’t charge any hidden fees or service charges for delivery.
Users can just download the app, order their food from a restaurant, and schedule a delivery pickup and drop-off time that works best for them. We offer flex delivery, convenient same-day delivery, and delivery services for just about anything else you might need!
From documents to gifts or even a bag of chips, we deliver anything.
If you want to help restaurants keep 100% of their revenue and profits while simultaneously enjoying the convenience of home delivery, sign up for Cantec Couriers today!
