What are advantages of ghost restaurant?

You don't need to hire waiters or customize your building to make it comfortable for dinning customers. The kitchen operator rents a small space in a larger shared kitchen area. Think of it as a bunch of mini-kitchens inside a much larger one. There can be between 5 and 20 different restaurants in the same space that prepare dishes every day to represent their virtual food brand.

It's much cheaper to pay rent for a small kitchen than to spend a lot of money for all the space. Even before COVID-19, foot traffic at restaurants in some areas had declined thanks to the convenience of food delivery apps. But now, receiving food from your favorite restaurants has become a daily necessity. Virtual kitchens save a lot of start-up costs, but the concept also eliminates many of the ongoing daily costs of running a restaurant.

Labor costs can account for 20 to 30% of gross income. Food costs represent another part of your income, but ghost kitchens usually focus on a niche or a limited menu. Once accepted, the incubator will guide and support new and experienced restaurateurs through a series of challenges in the hope of developing a successful ghost kitchen. Big companies, such as Panera Bread, use ghost kitchens to test new concepts, as they recognize that the next step in food is technology-driven.

There have already been incredible success stories of restaurants that have lost 50% of their revenues, but then added several lines of ghost kitchens and recovered all the lost profits and more. While no one knows exactly what the restaurant industry will look like after the pandemic, ghost kitchens are certainly still a popular option. Ghost kitchens are more useful for restaurants looking to expand their delivery operations and reach more customers at a lower cost. So, if a national restaurant chain doesn't want to enter the ghost kitchen market, there's no reason why it can't rent its space to another chef who does.

If you love Shark Tank, then you'll love ShiftPixy Labs' Ghost Kitchen Incubator program. Conversely, a ghost kitchen can work with less space and doesn't need to be in a popular location with a lot of foot traffic. More and more often, the food you order from a home delivery application is prepared by chefs who work for a restaurant that doesn't really exist, at least not in the traditional sense. Ghost kitchens also offer higher margins, since they rely solely on demand for delivery, which reduces or can eliminate overhead costs for space, furniture, traditional POS software and front desk staff.

For example, a Mexican restaurant can use a ghost kitchen to launch an independent Tex-Mex brand, giving the restaurant a way to reach more customers without opening an entirely new location. The simplest of all ghost kitchen models is where you would buy your product at a retailer, repackage it for your brand and deliver it. Florida restaurant chain Kona Poké planned to open up to seven corporate establishments before the pandemic broke out and, since then, has decided to open 20 ghost cuisine restaurants. Ghost kitchens have allowed restaurants to try new concepts, experiment with different business models and adapt to a new future that depends less on the experience of eating at home.

A ghost restaurant is just a brand of restaurants, with its own physical location (it is not rented through a third-party kitchen) and currently only offers home service.

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