Takeout and food delivery services have become the norm across the country, allowing busy consumers to order their favorite meals, snacks, and drinks with just a few clicks.
In the U.S., about 60% of consumers order delivery or pickup at least once a week, so many restaurants and chains are moving away from traditional brick-and-mortar locations to better serve dine-in customers. , has shifted its focus to a relatively new concept. Ghost kitchen.
What is a ghost kitchen?
While the name itself may conjure up images of haunted houses or supernatural storefronts, ghost kitchens aren't as scary as you might think.
Ghost kitchens, also known as dark kitchens or virtual kitchens, resemble commercial kitchens and the restaurant industry with a unique twist.
Ghost kitchens are created and optimized specifically for customers who place delivery orders and, in some cases, receive takeout orders.
These are designed for consumers who order online, over the phone, or most commonly through third-party delivery apps like Uber Eats, Grubhub, DoorDash, Postmates, and Seamless.
Read more about ghost kitchens
These “virtual” restaurants do not exist in the cloud or in an algorithm, but rather operate out of existing restaurant kitchens or commercial kitchens located away from existing restaurants.
Unlike traditional fast-food chains and fine-dining restaurants, ghost kitchens typically don't have a storefront or dining room.
Ghost kitchens use and occupy less space than traditional restaurants, giving you the luxury of paying less on real estate, such as rent or a mortgage.
You also have overhead costs because you don't have to hire or pay servers, hosts, cashiers, or other front desk staff, or spend extra cash on furniture, decor, silverware, glassware, and other miscellaneous items. and operational costs are kept low. item.
Thanks to cost-cutting measures, ghost kitchens allow restaurants to earn higher profits because food prices are typically the same as traditional sit-down restaurants.
But ghost kitchens can also be a lifeline for struggling businesses, especially after the COVID-19 pandemic, with many restaurants switching to delivery and takeout options or closing permanently. It has become.
Still, not all ghost kitchens are created equal, and they still require a significant amount of time, energy, and effort to turn a profit.
How do ghost kitchens work?
Most ghost kitchens can be set up quickly without the high risk of large upfront costs associated with a physical dining space.
Some ghost kitchens are not affiliated with existing restaurants and are created to sell food exclusively online and via third-party apps.
Ghost kitchens allow savvy business owners to avoid having to create a restaurant concept from scratch by renting kitchen space, creating a restaurant name, menu, and profile in a third-party app, and hiring a few chefs and You can hire a line cook.
Typically, all you need is an iPad and some software to track and fulfill orders and you can get to work right away.
On the other hand, some ghost kitchens are already tied to existing brands.
Fast food chains like Wendy's have begun experimenting with ghost kitchens, where they rent out kitchen space in high-traffic, high-demand areas, allowing consumers to get their food faster without the hassle of in-store or drive-thru pickup. is now available.
Existing restaurants can also try new menus and dishes in a low-risk environment, allowing them to keep up with trends and target additional demographics.
In some ghost kitchens, multiple chains or restaurants may “team up” to share kitchen space and create different types of food in one location, further saving costs.
There are no stores, so there is no need for customers to eat or drink inside, and some businesses are located on the outskirts of city centres, in industrial areas away from public transportation such as trains or buses, or with difficult parking or walking access. You can set up a ghost kitchen in any location. limited or non-existent.
One of the best things about ghost kitchens is that beyond being a cost-saving measure for business owners, they actually benefit consumers.
If you've ordered food from a third-party app in the past few years, you've probably ordered from a ghost kitchen.
Most people order from ghost kitchens without realizing that they are ostensibly regular restaurants.
A quick Google search will bring up the restaurant's address, and any photos and reviews will focus solely on takeout and delivery orders.
Where can I find a ghost kitchen?
Ghost kitchens, as the name suggests, aren't dead on arrival.
Ghost kitchens have been around since before the pandemic, but the rise of digital-only restaurants and virtual kitchens exploded shortly after March 2020, in part as more consumers were unable to safely dine out at their favorite chains and restaurants. increased.
During this time, more and more consumers have turned to delivery orders, allowing them to continue eating their favorite foods delivered directly to their homes.
Even after some restaurants reopen for in-person dining, many consumers still prefer the ease and convenience of having their meals delivered, saving time and money and avoiding the hassle of eating out. I did.
According to Statista research, “the online food delivery market is estimated to have revenue of more than $1 trillion” in 2023, and is projected to reach “$1.6 trillion by 2027.”
By 2030, ghost kitchens are “expected to hold 50 percent market share of the drive-thru and grab-and-go food service market,” including iconic brands such as McDonald's, Burger King, Popeyes and other chains. .
Some ghost kitchens are so successful that they become ghost franchises and operate dozens or more locations.
One of the most successful virtual restaurants in the United States is MrBeast Burger, a partnership between Jimmy Donaldson, the Internet personality known as MrBeast, and Virtual Dining Concepts, LLC.
MrBeast Burger has only one physical restaurant location in the United States, but more than 300 virtual locations throughout the United States, Canada, Puerto Rico, Mexico, Europe, the United Kingdom, and even Southeast Asia.
The YouTube star and vlogger isn't the only celebrity joining in on the ghost kitchen craze.
Guy Fieri's Flavortown Kitchen, Wiz Khalifa's Wiz Khalifa's Hotbox, George Lopez Tacos, and Buddy Valastro's Buddy V's Cake Slice are just a few of the well-known establishments associated with ghost kitchens.
Even established brands like Wendy's, Chick-Fil-A, Kroger, Ruby Tuesday, Wingstop, and TGI Fridays have begun operating their own ghost kitchens.
However, not everyone is in favor of ghost kitchens.
Some consumers have had, and continue to have, complaints about the secretive nature of ghost kitchens.
Other consumers felt cheated or taken advantage of when food they ordered thinking it was from one restaurant turned out to be part of a different brand or non-existent.
The rise in eating out post-pandemic has led us to reevaluate where and when ghost kitchens are needed.
Even some third-party apps have vowed to crack down on ghost kitchens, removing them from their apps and banning consumers from ordering from them.
“It's clear that the impact of ghost kitchens was overestimated,” said Evert Grujhardt, Deloitte's restaurant food and services leader, as reported by CNBC.
“And we see that today with the decline in ghost kitchens,” he added.
Despite the decline, thousands of ghost kitchens are still operating in the U.S. alone, and food delivery market revenues have increased by more than 200 percent since 2019.
