Insight

Restaurant industry won't give up the ghost

Luke Ritchie Luke Ritchie

Restaurants are embracing ghost kitchens as a way of meeting the growing takeaway and home-delivery market without the cost of overheads for dine-in customers.

Ghost kitchens (also known as “dark kitchens” or “cloud kitchens”) are delivery-only restaurants with no physical shopfront for customers. Consequently, they have no need for expensive fit-outs and run on a much lower cost base.

With orders received online through aggregators like UberEats and Deliveroo, ghost kitchens can be located away from expensive high street locations but still close to their customers. And restaurateurs can experiment with multiple offers run from a single kitchen, providing much greater scope to meet customer demand.

Coronavirus restrictions have crippled the dine-in restaurant sector in 2020, with traditional business models struggling in the face of large unused spaces, high rents and expensive staff. Whilst many have quickly pivoted to focus on home delivery, they have done so without robust solutions for waste management, technology or last mile connectivity.

A second wave of coronavirus cases in Victoria has reminded us that there is no certainty of a path back to “normal” for the retail and service sectors of the economy. New shopping and dining habits have now been firmly established, and restaurants must embrace the new opportunity presented by the enormous growth in demand for quality food delivered to the home.

The trend toward off-premise dining is not new, and dark kitchens have been around for several years. However, like many areas of the economy, coronavirus is speeding up shifts that are already happening.

New ghost kitchen concepts such as Colony Cooks and Cloud Kitchens are already revolutionising the restaurant home delivery space in North America and India. We can definitely expect to see more of this in Australia as the restaurant sector responds to the coronavirus challenge. 

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