A long time before COVID hit India’s shores. Long before there was even the trace of a nationwide lockdown, demographic and technological changes were at that point in progress that helped set out the establishment for what is today the Cloud Kitchen Model industry.
Demographic changes like constant increment in the number of nuclear family units and the rising number of working ladies encouraged on-call food delivery formats. Technological improvements further prompted basic movements in how the food got ordered and was consumed.
With time online delivery turned into the standard, as the option of single order placement, reliable delivery, and integrated online payments turned out to be more normal. These structural changes prompted the introduction of aggregator stages like Swiggy and Zomato. These aggregators further quickened the development of delivery and cloud kitchen model.
What Is Cloud Kitchen Model?
While there can be different kinds of cloud kitchens, in the easiest terms, a cloud kitchen is a web empowered restaurant kitchen that accepts orders just through telephone or online ordering systems. It offers no dine-in facility.
It is a base kitchen that delivers food to the consumers’ doorstep. Some cloud kitchen model supported brands with small physical outlets yet are sponsored by a base kitchen or cloud kitchens chain.
Boss among the points of advantages a cloud kitchen model gives is a low lease to income proportion. Naturally, these kitchens are situated in non-premium areas that don’t charge a high rental. Since there is no dine-in facility, the space needed to operate is reduced by 75-80% compared to traditional premium restaurants.
Cloud kitchen model additionally saves money in front of the house costs. They are not restricted by the number of seats and need not turn back customers because of restaurants running on the full limits. They additionally have the chance to grow at a quicker rate because of low-CAPEX necessities possibly.
Future of Cloud Kitchen Model
Information provided by Statista demonstrates that the “Cloud kitchen model” is looking forward to developing at a 12% CAGR through 2024. This arrangement will surpass the “Restaurant to Consumer (R2C)” model in market size by 2024.
Before COVID, the restaurant to customer business was expected to develop at 7.1% CAGR. Since the restaurant business was completely shut for 120 days, it was very guessed that the delivery design surpassing the restaurant model could happen prior.
In this new COVID-affected world, Cloud/Ghost/Virtual/Dark Kitchens have played a considerably more prominent job. These terms are regularly misunderstood. How are they unique in comparison to a traditional sit-down restaurant?
While many cloud kitchen model has the option to survive the COVID storm, the restaurant business has suffered significantly with the initial 120-day shutdown and followed now by demand failure as patrons continue to stay home. It’s a sad reality that many restaurants will go out of business. Every restaurant is currently in survival mode.
In the short term, it will become critical for traditional restaurants to survive. Regardless of whether they do make the rotate, many actually won’t make it. In the current environment and with the continued uncertainty of the COVID pandemic, cloud kitchens or F&B outlets backed by a cloud kitchen network have a better chance of survival. They are likely the fate of the food business.