What is a Ghost Kitchen?
The restaurant industry is going through changes that will alter it forever and Ghost Kitchens are presenting an opportunity like you’ve never seen before. But, you can’t sit back and watch. If you want to stake your claim in this new frontier, you’re going to have to act fast!
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Last year, the conversations I had regarding ghost, virtual, dark or cloud kitchens came with much skepticism. But this year everyone’s like, “Yeah, Ryan, let’s do it! But, how? What do we need to do?!” Obviously, the game has changed a little bit when it comes to talking about ghost kitchens or whatever you want to call them—
Ghost/Virtual/Dark/Cloud Kitchens—they’re all kind of the same thing. The differences are opinion based and so small that I don’t even want to get into it, so let’s just call them all the same thing for now.
What is a Ghost Kitchen?
It’s basically a restaurant that doesn’t exist. There’s no entrance or dining room, and you don’t need all of the extra staff. You really only need an online menu and you can do that for free through the third-party delivery companies. Then people order the food, someone comes and picks it up, and then they deliver the food to your guest. Your restaurant doesn’t need to exist at all.
This is the industry’s answer to dealing with the high cost of the third-party delivery that’s charging roughly 30% to pick up and deliver the food to your guest. That’s very cost prohibitive for most restaurant operations that were built on the traditional brick and mortar model.
The problem is with the convenience of third-party delivery companies and the necessity of having them during the pandemic. Essentially, we needed a way to answer the charge. They existed a few years ago but not in the popularity that they have now. The way that ghost kitchens answer the 30% charge is to get rid of everything; you just need a couple of cooks and you’re in business.
What is a virtual kitchen?
It’s a restaurant that’s either open in your current existing restaurant or in someone else’s facility and all you need is to cook the food. You don’t need to talk to anyone on the phone, rely on in-person guests, take money, and you don’t even really need managers assuming your food is easy enough to prepare. You literally just need a couple of cooks.
What a lot of people are doing, and what I’m suggesting to most of my clients that either need more business or looking for ways to expand, is adding a concept to their current restaurant. No additional staff is needed. You will probably need to order a few different ingredients but those are Cost of Goods Sold. It doesn’t cost you anything unless you sell it or if the food goes bad. But with the popularity of ghost kitchens, trust me, the food is not going bad.
With no added staff either front-of-house or back-in-house you can be up and running within a couple of days. All you need to do is create a menu. Reach out to your third-party delivery companies with that menu and your literally in business. It’s that easy! You could create a menu tonight and probably be in business by the end of the week. It’s really that simple.
Which Ghost Kitchens are Popular?
The trend I’m seeing with Ghost Kitchens are very specific, tight, and particular menus. For example, Chili’s has opened up their ghost kitchen concept called “Just Wings”. They have wings with 5 or 10 different sauces and fried Oreos for dessert. That’s it. They’re operating this ghost kitchen out of their 800 or 1,000 Chili’s locations across the world with no additional staff, rent, or insurance. Just a menu.
These very specific menus are becoming quite popular because of Search Engine Optimization (SEO). If you don’t know what SEO is and why it relates to this trend, you can watch some videos about the subject. In short, what’s happening is when people search for food, they don’t search for good restaurants in your area anymore. They search for the best wings, hamburgers or pizza in your area so these ghost kitchens with very specific menus are showing up at the top of the searches.
It’s also following the trend that food trucks started about 10 years ago because the economy tanked in 2008-2009. People weren’t spending as much money dining out. They wanted good food but they didn’t want all of the extra expenses that went along with the dining room. Some really creative chefs started food trucks with super high quality food and almost no overhead and labor. They were able to sell this really fun, interesting, specific, and great food at a very reasonable price. Ghost kitchens are following this same trend.
I bet 4-5 years ago, you wish you had started a food truck in 2010 because of their popularity. I guarantee you that 4-5 years from now, you’re going to wish that you had started some kind of a ghost kitchen. It’s the wild wild west out there. For those of you that are sitting back and waiting to see what happens, you’re going to miss out on the free land grab. That free land grab is the Internet.
It’s going to get very crowded quickly online and all of a sudden having a chicken wing restaurant isn’t going to be enough anymore. You have to be the best wing restaurant. You’re going to want to get out there right now and get thousands of reviews before the other players come into the market. Now is the time to open up your ghost concept(s).
If you currently have a ghost kitchen and want to be better at it, or if you want to grow and expand, or if this is something that you’re interested in learning, we’ve created a training program called the Ghost Kitchen Bootcamp. We’ve seen a lot of success in helping our clients open these concepts. One of my clients operates an Egyptian restaurant. We opened up a ghost kitchen concept that is a pasta restaurant. I know…that has nothing to do with the original concept! He’s seen so much success that now we’re opening up a fried chicken concept. In the Ghost Kitchen Bootcamp, I will share all that I’ve learned helping my customers successfully open ghost kitchen concepts so you can do it yourself!
Remember: systems create freedom, freedom creates value, and value is what allows you to scale.
I love every single one you crazy restaurant people and I can’t wait to bring you another video just like this. Have an absolutely amazing day!
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