Eps 4: How To Start A Business With Only Ghost
— Daniel
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Angel Sims
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If you are going to set up a ghost kitchen inside your dine-in restaurant, pick items on your menu that lend themselves to delivery. If you are looking to expand your clientele, opening up a ghost kitchen at a different location could help you ramp up production and provide delivery-only services in new areas. Since the ghost kitchen is solely focused on delivery, make sure you choose a central location where you will serve an optimal number of customers and at a lower cost to your business. Many say you can start your ghost kitchen wherever you like, but you may want to find a rental property located in an area surrounding your target market.
While curb appeal or a nice storefront are not essential for a ghost kitchen, Alex Blum, CEO of Relay - an online platform connecting restaurants to delivery couriers - says that location is essential for making sure that you are reaching a wide enough potential market. To stay competitive, it is important to create a delivery service using the ghost restaurant or ghost kitchen model that works according to the demand at hand. With the ghost operation, the entire focus is preparing meals for the delivery-only restaurant. Instead, this new business model requires just the kitchen and the delivery driver.
The Ghost Restaurant Business Model removes, streamlines, and simplifies many of the variables that make a traditional restaurant so complex and costly to run. If the concept is implemented correctly, the ghost restaurant business model scales extremely well, and entrepreneurs will often choose to build several brands of food from one kitchen, which helps to reduce costs further. With ghost kitchens comes infinite possibilities as far as what you can do in terms of starting up new brands or managing multiple virtual restaurants, all in one place, as your presence is on the web.
Since you have the kitchens in place, your virtual restaurants can get started once you figure out menus and delivery options. Or -- if you already have a restaurant -- you can work up a virtual restaurant business plan to help you make more money with online orders.
Once you are set up with the business kitchen equipment needed for operations, you will start promoting your restaurants brand online on a number of delivery apps. To start with the Ghost Kitchen, or Virtual Kitchen, you will begin by renting out a facility where you can prepare your delivery orders.
While you could choose to lease a space and start on your own, there are also companies offering leasing services for spaces designed specifically for ghost kitchens, and some also offer turnkey operations with any hardware that you may need. Operating can be a time-intensive strategy, which is why most ghost kitchens start out on at least third-party platforms, and then build out an independent online ordering and delivery pipeline afterward. You may begin with a single order-and-delivery strategy--say, exclusively relying on third-party platforms--and switch to a different one as your ghost kitchen business grows.
Well, if youare looking to add a source of online order revenue to your brick-and-mortar restaurant, first, youall want to think about which types of ghost kitchens would compliment your existing operation. No worries: starting a delivery-only restaurant does not mean that you have to get a self-ordering kiosk, but it may be necessary to obtain a point-of-sale system, which would certainly benefit your ghost restaurant.
Delivery-only concepts are democratizing access for food entrepreneurs looking to test markets without the need of a preexisting customer base, or being physically located in a high-traffic area for traction. Because of these ample market opportunities, the food entrepreneur looking to launch a delivery-only food company can focus on the elements needed to please the growing category of diners, while having considerably less resources in terms of capital or overhead costs.
Ghost Kitchen allows you to take advantage of an online delivery business that is growing quickly, projected to hit $490 billion by 205.2 Now more than ever for the restaurant industry, adapting to the online delivery market is essential for taking advantage of the demand from the marketplace. Ghost restaurants, capitalize on increased delivery demand while cutting out all of the costs associated with a traditional dining experience.
For instance, at the beginning of 2019, Khadiq Fourie sublet one of his brick-and-mortar restaurants to a friend, an ex-CFO from fast casual restaurants, who wanted to give ghost restaurants a shot at their uniquely late-night, sauce-driven, rotisserie chicken concept. Hady Kfoury, the owner of a New York City-based Lebanon chain An NYC-based Lebanon chain, recently opened the ghost kitchen at $50,000 startup costs, saving thousands from an estimated $1 million that Hady Kfoury needed to start the new, full-service location. Ghost Kitchens operator, Zuul, presented an opportunity for Kfoury to expand to Soho, a part of the NYC-based market outside the reach of Nayas delivery, for a fraction of what a new restaurant starts with.
Hadi Kfoury was approached by Ghost Kitchen operator Zuul, a 5,000-square-foot space in Soho that opened in September 2019 with ten separate kitchens, each devoted to churning out orders for Soho, the delivery-only New York City location. Starting a ghost kitchen is an inexpensive way to start a restaurant brand, and the Fit Small Business Guide covers the 13 steps--from creating your concept and branding your business, to coming up with your order strategy, sourcing vendors, and getting your brand launched.