The Rise of the Ghost Kitchen: Unlocking a New Frontier of Customers

Growing up in my dad's seven restaurants were some of the most rewarding years of my life. With so much of my life invested in this industry, seeing it crumble with the COVID-19 pandemic was heart-wrenching. However, from the ashes rises a new age of restaurants — one of opportunity, innovation, speed, and convenience.

In this article, we'll cover Ghost Kitchens and everything you need to know, including:

• What is a Ghost Kitchen?
• Why are Ghost Kitchens becoming so popular?
• What factors are driving this innovation?
• How are Ghost Kitchens impacting the service industry?
• How can your service company prepare for this revolution?

Introducing the Ghost Kitchen

Ghost Kitchens (aka "virtual kitchens", "cloud kitchens", and "dark kitchens") are essentially restaurants with no front-of-the-house and only a commercial kitchen for on-demand delivery. A Ghost Kitchen can be up and running in an average of four weeks vs. one year to build a traditional storefront restaurant.

Why are Ghost Kitchens Becoming so Popular?

A typical Ghost Kitchen uses on average 200–300 sq. ft of real estate compared to 2,000 sq. ft for a traditional restaurant. A Ghost Kitchen only needs 3–5 employees per location versus 15–30 for a typical storefront. This drastically decreases overhead expenses and translates to more profit. In fact, a Ghost Kitchen can break even within six months, whereas a traditional restaurant usually hits break-even within five years.

The Massive Opportunity for the Commercial Food Equipment Industry

The restaurant delivery market is currently a $40 billion market. Within four years it will be worth $460 billion. And by 2030, we will be looking at a one trillion dollar food delivery market. Equipment repairs and maintenance make up an average of 3% of annual revenue for restaurants — meaning a trillion-dollar market yields an additional $30 billion per year of opportunity for the Commercial Food Equipment Service Industry.

How Can Your Business Prepare?

• Send out mailers to customers educating them on the benefits of Ghost Kitchens.
• Equipment is often not included with a Ghost Kitchen — offer to help your restaurant clients source and install equipment.
• Check in with all of your restaurant customers about their expansion plans and Ghost Kitchen strategy.
• Evaluate your team and company internally — do you have enough staff for the demand?
• Educate your staff on Ghost Kitchens and encourage forward-thinking about industry trends.
• Make sure your service business is running at optimal capacity with the right technology partners.

Roopairs is the first all-in-one software platform for Commercial Food Equipment Service Companies. The "Rise of the Ghost Kitchen" is happening fast. How will you be prepared to maximize your profits and rise to the occasion?

Stay Hoppin'