India’s Future FB Tariff Beginning of the Cloud Kitchen Revolution

The food service business traditionally works on a high risk model of fixed costs including rent, employee salaries, Opex, etc., and requires a continuous flow of cash day in and day out through the consumer channel in order to be profitable from a business. For these typical sit-down restaurants in front of the house, the daily bread was a walk-in customer, and the butter came from home / work-supplied food. The infrastructure from order creation to delivery was pretty old fashioned and could only serve a smaller area near the grocery store. The food was being prepared again in ancient kitchen appliances that often lacked many standards of safety and food safety. Additionally, the usual marketing channel has been word of mouth to make or break a grocery store’s business. With the introduction of technologies to retrofit most of these aspects, food service companies slowly learned how things are made more tangible by various factors such as “smart” interiors for ambience, maintaining high hygiene standards in food and services, and installing new aspects can age kitchen equipment to reduce the hassle of back-end kitchen staff and provide evenly flavored and textured food year after year. The world didn’t stop there. Understanding what the guests needed was another major hurdle. What started about a decade ago when everything became increasingly available on the internet and people around the world were able to access / rate it via their phone, has made large companies in different industries switch online and made dot-com culture boom. Globalization was at its peak. However, the food service business remained far-fetched and a bridge was missing to establish this connection with customers in real time.

This has boosted the idea of ​​the food service aggregator as a business model for start-ups in India and abroad. All of these features offered by the FSAs provided an e-marketplace with restaurants, real-time updates on order taking, details of the grocer’s person, tracking the person’s ID, etc., and put people in a storm that the fact popularized that the food of your choice can also be achieved with just a few clicks on their phone.

The rise of the cloud kitchens as a concept
The beginning of this trend soon evolved into a culture where take-away consumption increased and almost matched that of walk-in customers. This fact sparked the idea of ​​several young entrepreneurs to find out how a kitchen model would thrive on delivery, while working on a model with low risk and nominal investment. This is how the Cloud Kitchen / Dark Kitchen / Delivery Only Kitchen model was born.

A cloud kitchen is a delivery-only restaurant concept with no physical space, no dining area, or no take-away counter. It is a restaurant kitchen that only accepts delivery orders with no traditional restaurant or restaurant. Just a ready-to-use kitchen for food preparation that functions as a production unit. No fancy infrastructure, no swimming staff, no tables, no furnishings, nothing at all. Customers can place their orders online via the online food aggregator ps or the restaurant p, hence the name Cloud Kitchen.

Advantages and disadvantages of a cloud kitchen
The advantages associated with this model are many. First and foremost – small footprint for secluded real estate, which keeps operating costs to a minimum, which is not the case in a traditional restaurant with seating. Low operating costs due to on-site staff and logistics costs completely eliminated. A production room could be used as a common home for many brands that offer different kitchens. In addition, a digitally presented brand could be more easily expanded to newer geographies than a stationary restaurant brand. All of these factors make the company a high profit company and ROI is a faster way to go.

While a business owner is easily lured into opening a cloud kitchen, there are a number of hurdles to be aware of in order to avert any kind of unpredictable risk that leads to premature closure, brand failure, etc. Given the dependency of being only virtually present as a brand, customer training and popularization in the masses is a cumbersome process and very time-consuming. You have to know the art of using different social media channels and FSA-In-P advertising to get in touch with potential consumers. Plus, FSAs have their stake in the cake by charging restaurants between 15 and 35 percent commission, which can be worrying for the cloud kitchen brand in the long run. Finally, the grace of the FSAs can have its own effects, e.g. B. Consumer-free data that helps the cloud kitchen better understand what its consumers want and make changes accordingly. This has a long-term impact on sales as customer loyalty would be minimal.

What future does Cloud Kitchens have?
With increasing internet penetration and the age of the millennials with disposable income requiring digital, mobile-friendly solutions, the trend towards virtual restaurants (delivery-only brands) has recently attracted attention. Cloud Kitchens have evolved the traditional restaurant industry, as have meatless burgers. And this is more likely to grow with the next generation who grew up with the internet and smartphones, hits the market, advances in kitchen automation and drone delivery. Many restaurants are now moving towards cloud kitchen operations. Tech platforms like Uengage help these restaurants and make it easier for their customers to order, pay online and have their groceries delivered to their homes at the touch of a button.

Since the cloud kitchen business still has great potential, this may be the best time to invest in a cloud kitchen business model. With minimal risk, it is one of the safest options when investing in the food service industry. And even if you already run a profitable restaurant, investing in a cloud kitchen would require fewer investments and bring more profit at lower costs compared to the classic dine-in restaurant.

According to research, 81 percent of people in India order groceries online. There are 317 cloud kitchens in India that operate over 2000 internet restaurants in 35 cities. This shows the increasing potential of the cloud kitchen as a model for expansion.