Why Chain Restaurants are Turning to Ghost Kitchens

The COVID-19 pandemic has caused a major shift in the restaurant industry, with many traditional restaurants turning to ghost kitchens to help them recover their losses and minimize employee layoffs. Ghost kitchens are food preparation operations without waiters, dining room or parking; in reality, without any public presence. These facilities allow restaurants to prepare food for several brands and stay in business, while also reducing risk and allowing franchise owners to test demand. The trend of ghost kitchens has been quickly adopted by customers, and is likely here to stay.

Ghost kitchens are physical spaces for operators to create food for consumption outside the facility. One trend that is becoming more popular is the formation of central ghost kitchens, type of economato, with several restaurants or brands that work in the same physical space. Famous Dave's is not only partnering with an external brand, but it's also using its Granite City restaurants to also add the famous Dave's ghost kitchens. Restaurants that have adapted to home delivery, outdoor dining and ghost kitchens have been more successful than those that don't.

Companies create virtual brands, which usually consist of a logo, a name and a short menu, and then license them to restaurants and bars, who execute the recipes and package them for takeout and delivery. Ghost kitchens also sell faster than full-fledged restaurants because they don't require a dining room or waiters. Ghost kitchens are smaller than full-service restaurants, making them a highly efficient real estate model. But this ghost kitchen strategy quickly expanded the chain across the country to cities that weren't initially on its radar.

Some small food operators were using ghost kitchens to gain a foothold in the market at a time when opening a standard restaurant with a dining room would have been unthinkable. With high fees charged by major delivery services, food delivery companies that work in ghost kitchens could find a way to make a living. The Ghost Kitchens series is presented by Leer, a recognized leader in the temperature-controlled storage industry.

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