Cloud kitchens are delivery-only brands with only a kitchen space, without any cost incurred in dine-in or in-house staffing except for the one that will work in the kitchen and delivery staff. The cloud kitchen business model is growing more and more across the globe as the pandemic drags further. But what does that entail for all the food businesses? Is the cloud kitchen model an endgame or an opportunity for restaurants? We discuss all of that in this blog.
Cloud Kitchens – A step opposite to dine-in
In the pre-coronavirus world, the cloud kitchen model wasn’t really the talk of the town. Restaurants were thriving with their dine-in services, so much that they were bringing new concepts to the table almost every other day. But then came the pandemic, and dine-in went out of business. Any restaurant with proper delivery services was the only one that survived the outbreak, and those that had limited delivery and takeaway options failed to continue their operations.
This gave rise to a need for proper delivery services that could take care of operations even in places where restaurants couldn’t reach. The solution to this came in the shape of the cloud kitchen model. Although the model wasn’t new in 2020, it certainly became a need of the hour quite suddenly in the Covid-19 impacted world.
Now, the question is, with people becoming more and more used to the convenience provided through delivery services, will restaurants and every other food business be able to survive the influence? The answer is yes.
The Opportunity for Food Businesses through Cloud Kitchens
One of the most important things people need to focus on is how cloud kitchens are shared kitchens that only aim to expand the delivery operations of every food business across a wider area where the business themselves can’t reach with their limited delivery option. This alone makes it easier to understand that with cloud kitchen services, food businesses should be glad to have a solution to their delivery model that can end up expanding their business operations and lead to success. The cloud kitchen model is expected to grow by $71.4 billion in the next 7-10 years, making it even more essential for food businesses to invest in them.
High Profits at Lower Cost
The cloud kitchen model automatically means the business won’t have to invest money in dine-in spaces and front-house staffing. In fact, the shared kitchen only needs a kitchen space, meaning it can be set up in remote areas as well, with lesser cost invested in rent. With this low-cost shared kitchen start-up, the room for growth is extensive. Being set up in a remote area means you have access to a larger delivery location that your own food business can’t reach. This will increase your consumer demand, and make your business more profitable as you keep investing in a cloud kitchen model.
Freedom of Experimentation
Cloud kitchens provide the added benefit of being able to experiment with a restaurant’s menu. This menu can be optimized according to audience preferences, and even customized to fit the demands of any particular location. E.g. consumers in a specific locality prefer more Pizza than any other food item, so their menu will be customized according to this fast-food requirement. While those of other localities may prefer Chinese and other continental cuisines, hence a menu that caters to that need. This will lead to more customer favorability and growth for not just the cloud kitchen but also the food businesses collaborating with that cloud kitchen.
Hotpod’s Cloud Kitchen Model
Hotpod is Pakistan’s first managed cloud kitchen model. The concept behind this managed kitchen startup is to collaborate with multiple food businesses, get access to their recipes, cook their food, and deliver it to their customers with ease, scaling locations on a hyper-local level. The original restaurant only needs to invest their menu items and recipes, and Hotpod will handle the rest. The goal for Hotpod is to ensure the growth of every small food business and make their operations optimized enough to match with their competitors and expand their business.
Although the managed kitchen is currently only operating in Karachi, soon the delivery kitchen business model plans to set up in almost every city of Pakistan. This will not only expand the delivery services across the country but also lead to every consumer having their nation-wide food preferences met only through Hotpod’s cloud kitchen model, even if the restaurants aren’t yet operating in those cities.
Hotpod is the latest kitchen model that was previously unknown to the Pakistan food market, but this isn’t the first time a new and unique venture has come up to disrupt Pakistan’s overall business model. Previously, the launch of Careem and Uber in the transportation industry of the country brought a disruption that changed the lives of travelers across the country, making the process of traveling across each city more efficient and relatively safer.
Furthermore, in the global space, e-commerce solutions like that of Amazon and Alibaba brought a disruption that made every other business rethink their position in the retail market and reconsider their digital presence and availability across channels.
Just like those brands that were new concepts, yet they became the big names in their respective niches, Hotpod’s cloud kitchen model, like Kitopi’s in the UAE/MENA, is here to stay and bring significant growth in the food industry of the country.
With the increase in demand for food delivery, it’s obvious that cloud kitchens are the future of the food industry. So instead of asking questions such as whether cloud kitchens are an endgame for food businesses, we need to ask the more important questions i.e. how can food businesses make themselves part of the cloud kitchen model, have their services optimized and expanded, and lead to their growth.
Hotpod, and every other cloud kitchen of its kind, is not a hindrance in the food business industry rather a revolution that every food business needs to make itself a part of. The cloud kitchen business is only going to grow and with it the food industry. How businesses make themselves a part of this cloud kitchen model, is what every food business needs to prioritize on.