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The term “delivery-only kitchen” (sometimes referred to as a “ghost kitchen”) is fairly self-evident; it refers to a restaurant that makes food for delivery, often without indoor dining space, and often in partnership with an online food delivery platform.
Delivery-only kitchens have surged in popularity in recent years. Statista, the world’s leading business data platform, places the global market size of delivery-only kitchens at $43 billion this year, expecting a sharp rise in coming years.
What precipitated this rise in delivery-only kitchens? In this post, let’s take a closer look into the soaring popularity of this relatively new kind of business by addressing its value to business owners, consumers and communities.
Addressing the Pandemic
You can’t discuss the rising popularity of delivery kitchens without mentioning the global COVID-19 pandemic. As the Statista report linked above points out, seated restaurant dining plummeted by 100% at the beginning of the pandemic as governments enforced strict stay-at-home and physical distancing measures.
Yet, people remained both busy and hungry, in need of quick, convenient and contactless options for dinner. It made little sense for restaurant owners to continue paying for massive brick-and-mortar locations as they shifted from dine-in to delivery. Thus, the market size of delivery kitchens skyrocketed.
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Removing Barriers to Entry
COVID-19 was a catalyst for the rise of delivery-only kitchens, but it only tells half the story. For the other half, you have to turn to the intrinsic value of delivery-only kitchens. What do they offer business owners and consumers that the brick-and-mortar model can’t?
For one, they remove barriers to entry for both entrepreneurs and diners. Delivery kitchens allow restaurant owners to create – and/or expand – a profitable business with little to no investment or cost, essentially taking the risk out of an infamously risky business. On the diner side, delivery kitchens make ordering quality food easier, safer and more convenient. People with mobility issues and those who live in less commercially dense areas can access great food from a website.
Further Benefiting Customers
They have built on the idea of virtual kitchens by transforming open urban spaces into neighbourhood hubs for modular applications like delivery-only food concepts. In doing so, they can offer consumers on-demand, fee-less delivery of fresh food and consumer packaged goods.
Delivery-only kitchens, like the ones operated by REEF, help develop what are known as “15-minute neighbourhoods.” Essentially, these are urban neighbourhoods that are walkable as opposed to car-dependent. If you want a quick bite to eat, you can order pickup or delivery from the neighbourhood kitchens down the street. If you run out of potato chips mid-way through bingeing a TV series, you can order or pick up consumer packaged goods from a business nearby. The commercial density makes neighbourhoods more liveable, accessible and eco-friendly.