Get the lowdown on ghost restaurants

Ghost kitchens seem to be the trend these days. But before you jump on the bandwagon, here are some FAQ that we hope can help you! 

Q: What are ghost restaurant? 

A: A ghost restaurant is a delivery-only or online-only restaurant. Customers are served through phone, online or through mobile apps. Think of it as a restaurant without front-of-house staff and physical seats!

Q: How does it work?

A: Commissary kitchens or ghost kitchens are the most common. These are shared kitchen spaces run by a third part, that are used by multiple restaurants. 

Facilities like the refrigerator, frying pans and stoves are shared. Customers place orders online or through the phone, and the food is delivered to them.

If you are a restaurant owner who is thinking of trying a new concept or brand, you can also prepare the food and run this new business from your existing brick and mortar premises.

Q: Sounds like a catering business. What’s the difference?

A: It is very similar, except catering is usually planned in advance. At ghost restaurants, time is of the essence and businesses must serve customers almost immediately – orders are placed, made and delivered at once. 

Q: Who are ghost restaurants for?

A: Anyone! Existing restaurant owners may use their own premises or ghost kitchens to expand their menu or test out a new concept.

Aspiring restaurant owners can also use ghost kitchens to launch a new ghost restaurant.

Q: What are the benefits?

A: It can cut costs, as you need less space than an in-house dining restaurant. The cost of hiring front-of-house staff is also eliminated, along with the problems that come with finding and managing the staff and ensuring good service.

There are also economies of scale that come with being part of a kitchen that houses many different concepts or brands, as you can share ingredients and equipment.

Revenue can rise as you serve a wider market – delivery means you are not limited to the area immediately surrounding your brick and mortar outlet.

Finally, it affords flexibility. If your menu is online, you can change it whenever you like without incurring additional costs from printing materials. You are more able to experiment with new menu items, and adjust your menu if there are issues with ingredients and suppliers. 

Q: Sounds good, are there reasons we shouldn’t do this?

A: Although there is a potential to reduce costs and raise revenue, it is not the silver bullet to all your restaurant woes. 

For example, the benefit of having less interaction with customers comes with the cost of managing third-party delivery providers and becoming out of touch with your target market. Also, with delivery comes a greater burden of ensuring food safety – many things are hard to transport and do not keep well.

If you are an existing restaurant owner, you may face challenges training your existing staff and adjusting your inventory, while if you are an aspiring restaurant owner, you may find it more challenging to build your new brand solely with an online platform.