Starting a food business can be a lucrative business venture, but it can also be expensive. In addition to the costs of running it, a food service business needs expensive equipment and a good kitchen to do well.
Fortunately, “cloud kitchens” provide entrepreneurs with the tools and resources they need to get started. This has helped many first-time entrepreneurs and even busy celebrities start their own food businesses. In this article, we’ll learn more about cloud kitchens and how they could be beneficial to you.
What is a cloud kitchen?
A “cloud kitchen” is a large commercial kitchen or food production facility where many food companies rent space and use equipment and other facilities. Businesses that collaborate with a cloud kitchen work through a food delivery service. Simply put, when a customer places an order with your company, your designated cloud kitchen staff prepares it and a 3rd-party delivery service delivers the order to the customer.
In the Philippines, one of the biggest cloud kitchens is CloudEats. Celebrities such as Gabbi Garcia and Khalil Ramos collaborated with CloudEats for their business, Meat Up! Billy Crawford and his wife, Coleen, also partnered with a cloud kitchen for the food business, Casa Crawford.
Benefits
Cut startup costs
If you’re a budding entrepreneur, you can cut upfront costs because you don’t need to build a physical kitchen or open a restaurant. By leasing a space in a cloud kitchen, you no longer have to prepare capital for other expenses such as building inspections, construction, furniture, equipment, and many others.
Lower operation costs
Another benefit is that it has a lower operating cost because it does not even require you to keep up a large labor force. Depending on the terms of the cloud kitchen, utilities, property taxes, payroll, and maintenance costs may be shared communally or included in the leasing costs, resulting in cost savings.
Price flexibility
Because your maintenance costs are relatively lower, you have greater pricing flexibility, which makes you more competitive in the market.
Drawbacks
Lack of customer interaction
Delivery services make it hard for restaurants to build relationships and offer personalized service experiences. Since there’s no front-line staff, complaints take time to resolve. Also, you tend to be less hands-on with your business, which can be demotivating for many passionate entrepreneurs.
Dependence on food delivery
Complete reliance on delivery services does not work for everyone. When a delivery service becomes unreliable, your business may suffer.
If you’re thinking of collaborating with a cloud kitchen, take the time to research and understand the company’s policies to see if they suit your business goals. Good luck!
- IT Engineer Quits Job To Sell Siomai, Now Earns P5,000 A Day - June 30, 2023
- From Chocolate Cakes To Noodles: Maricar Reyes’ Food Businesses - June 25, 2023
- How To Be A Cebuana Lhuillier Authorized Agent - June 17, 2023