- Restaurants are cutting back on “ghost kitchen” operations due to increased stress and customer complaints.
- Brands like Wendy's and Kroger are closing ghost kitchens, the Times reported.
- Ghost kitchens have been an exciting innovation during the pandemic. But anonymity lowered the bar.
Ghost kitchens, once hailed as an efficient innovation in the food industry, have instead suffered from their anonymity.
A ghost kitchen is a restaurant that doesn't have a storefront or seating that customers don't see, and only does delivery. During the COVID-19 pandemic, it seemed like a good idea. Restaurants and so-called virtual brands have invested heavily.
But as the pandemic subsided, demand declined, and the reliance on multiple layers of faceless technology led to complaints about quality. After all, customers didn't connect with many brands. And now, many restaurants and virtual brands are saying the stress isn't worth the reward, The New York Times reports.
Some influencers and celebrities are using ghost kitchens to produce their own food, like YouTuber Jimmy Donaldson, known online as Mr. Beast, who developed the Mr. Beast Burger in December 2020. ing.
“Stranger Things” actor Noah Schnapp also opened a chicken tender chain called Tender Fix in March 2023, cooking food in about 1,000 IHOP kitchens. It's also unclear whether TenderFix is still in operation. The company's social media pages haven't been updated in about a year, and its website is no longer available.
Big brands like Wendy's and Kroger are scaling back ghost kitchen operations after kitchens struggle to keep up with orders and complaints from customers, according to the Times.
Brinker International, which owns Chili's and numerous other restaurant chains, opened two virtual restaurants during the pandemic called “It's Just Wings” and “Maggiano's Italian Classics,” using Chili's locations to prepare food. did. But last year, as more customers began returning to in-person dining, the company found it difficult to balance both. So Brinker closed Maggiano's in 2023 and downsized It's Just Wings, the Times reported.
“Everyone thought running a virtual brand would be easy given the labor and equipment, but the reality is that most virtual brands' delivery times are “during normal restaurant busy hours.” times. “We were flooded with virtual orders and it was difficult to get through the busy dinner rush.”
And as quality issues and delivery delays worsen, some ghost kitchens are starting to run into legal problems. In August 2023, Donaldson sued Ghost Kitchen's partner, Virtual Dining Concepts, alleging in court documents that some customers complained of receiving raw meat. For now, Virtual Dining Concepts continues to operate MrBeast Burger.
“One father of two felt he had 'let his children down' by ordering a Mr Beast Burger when he received poor quality food in unbranded packaging. “It turned out to be a 7-Eleven,” the lawsuit states.
Cracker Barrel also opened its own virtual restaurant using CloudKitchens, another ghost kitchen group, according to Restaurant Business.
Cloud Kitchens, run by Uber co-founder Travis Kalanick, is facing a class action lawsuit alleging the company misrepresented the origin of food ordered by customers on food delivery apps like Grubhub and DoorDash.
Still, some chains like Denny's are fully embracing the cloud kitchen model, the Times reported. The company owns his three virtual brands: Banda Burrito, The Meltdown, and Burger Den.
Denny's President and CEO Kelly Valard said Denny's stores are open 24 hours a day, allowing them to meet higher customer demand than most other chains.
