As originally published on Startup MGZN.
Cloud Kitchens have become the new hype! With a growing number of online users and the shift to a more sustainable business model during the COVID-19 outbreak; cloud kitchens would help F&B business survive. According to a report published by Allied Market Research, the global cloud kitchen market size was valued at $43.1bn in 2019 and is estimated to reach 71.4bn by 2027! But what are cloud kitchens and what makes them such an attractive business model? Let’s dive in!
Cloud kitchens, also known as “Virtual Kitchen” or “Ghost Kitchens” are basically a delivery-only restaurant with no physical space for dine-in relying solely on online orders placed through food aggregators or website/mobile apps.
What are 6 different types of cloud kitchens?
- The independent cloud kitchen – A single brand, single kitchen with no storefront, can accommodate delivery via an aggregate.
- The multi-brand cloud kitchen – Has multiple types of cuisines, a single kitchen, multiple outlets, and no storefront.
- The hybrid cloud kitchen – A single brand, single kitchen, multiple outlets with a storefront.
- Delivery app owned “shell” cloud-kitchen – Aggregator owned, the multi-restaurant brand has rented coworking kitchen and no storefront.
- The delivery App owned, fully stacked cloud kitchen – Aggregator owned, multi-restaurant brand, has a rented kitchen, with a storefront.
- The fully outsourced cloud kitchen – Cooking and delivery is fully outsourced.
The best thing about cloud kitchens is that you don’t need heavy cash investments to begin, allowing businesses to save on initial capital and operational costs. One of the major investments would be on the technology that would leverage the entire business operation and in some cases a well-equipped kitchen infrastructure and trained manpower (chef’s and delivery drivers).
From a customer perspective ordering online is definitely more convenient, also the “click it and get it” model appeals to most people living fast-paced lifestyles, and with the COVID-19 situation, many people find it safer.
Who are the top players in the cloud kitchen game?
The growing opportunities in the online delivery service have paved the way for many successful ventures in the MENA. Here’s a list of the top 4 cloud-based kitchens in the region.
Founded in January 2018 with headquarters in the UAE. Kitopi partnered with 120+ restaurants, preparing 200 dishes for 30 different outlets every day. Kitopi’s operations continue to expand recently in March 2020 Kitopia launched an online grocery store Shop Kitopi. Kitopi was able to raise $117.2 since its launch.
An innovative concept that offers smart kitchens in prime locations allowing F&B’s to extend their reach to their customers, the platform announced it has secured $10M funding since its launch.
Delivers world-class cloud kitchens enabling regional and international food brand owners to enter new markets, kitsch is planning on opening cloud kitchens in Riyadh within the first quarter of 2021 and 15 kitchens across the GCC. The company currently raised $5M.
A food tech company with a focus on wholesome comfort food, with 15 cloud kitchens and a variety of cuisines ranging from Middle Eastern to healthy wraps to noodles & pizza! The company currently raised $4M in new funding.
Cloud kitchens have made food ordering a lot easier for consumers, and from a business perspective saving on operational costs makes a huge difference. The food industry is slowly adopting a strong online presence and we think restaurants that adopt this business model will see great success in the future!
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