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Ghost kitchens are a new type of restaurant model in which several restaurants share a kitchen and many of the operating costs.
These restaurants are delivery-only and rely on apps like Uber Eats and Grubhub.
Ghost - Kitchen - Opportunities - ? - Challenges
We toured a ghost kitchen and found out why it's creating opportunities — and challenges — for the food industry.
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Transcript - Episode - Business - Insider - Today
Following is a transcript of an episode of Business Insider Today. Watch the full episode here.
This pizza is made by a restaurant that no one can eat at.
Same - Sandwich - Salad
Same with this sandwich and this salad.
It's a new type of business model called a "ghost kitchen," a shared space for restaurants with no traditional storefronts or dining room.
Apps - Uber - Eats - Grubhub
Instead, they're delivery-only, relying on apps like Uber Eats and Grubhub.
Enrique Mendez, cofounder of Stone Bridge Pizza & Salad: "The way people are finding food is no longer physical. It's not by walking around and seeing the restaurant. A lot of people find restaurants online or in the virtual world."
Year - Americans - Order - Food
Last year, one in four Americans used apps to order food. And by 2025, online ordering could bring in more than $200 billion globally.
It has created both an opportunity and challenges for the food industry.
Mendez - Cost - Services - Volume - Profits
Mendez: "The cost of those ancillary services is so high that even though they're helping you get to a certain volume, they're not necessarily helping with profits."
Food apps take a percentage of each order they service — sometimes up to 30%, plus processing fees for credit card orders.
Restaurants - Thin - Margins
That can be overwhelming for restaurants that already operate on thin margins.
Zuul Kitchens opened last year as a way for restaurants to share costs and make the most out of these third-party apps.
Idea - WeWork - Kitchens
The idea is like a WeWork for kitchens.
And it works like this: Kitchens receive orders from a variety of online...
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