How to Transform into a Cloud Kitchen? [& Earn Revenues ]

As a restaurant owner, it is frustrating to wait for everything to come back to normal. It seems like a long time ago when you had a ‘normal’ busy weekend at your outlet.

Now, it’s only about survival and waiting for things to work out for themselves. But things can change if you make small tweaks to your operations. Discover how to utilize your existing setup to open a new income stream (one that’s lockdown proof)

When will corona end and this lockdown be lifted?

When you are a business owner, you can’t leave everything to destiny (and the virus). You need to have a plan to make things work – for your restaurant, employees and for yourself. 

“When the whole industry is crying of a bloodbath, how does one think of growth? How do you, as a restaurant owner, come out of this gloomy scenario?.

Well, first of all, it’s not new – yes the pandemic is a first, but restaurants were already suffering, especially the ones who depended heavily on offline footfalls. 

With Zomato, Swiggy and other players coming in, the eating-out preferences changed. And don’t get me started on predatory gimmicks like heavy discounts, coupons and ‘exclusive’ loyalty programs (topped with ruthless commissions for restaurants to pay) by the food aggregators.

The scenario became more grim when the pandemic started and lockdown happened- because now dine in orders are out of the equation. 

So, now you have to look the other way, a way that’s lockdown proof and can help you attract foodies online, like launching a delivery-only food business – a cloud kitchen.

What are Cloud Kitchens? 

A cloud-kitchen is a unique delivery-only business model for foodpreneurs that allows you to run multiple virtual brands and cater to different kinds of foodies using the same set up. 

The cloud kitchen trend picked up pace a few years back with startups like Fassos bringing it to light. Since then, many cloud-only restaurant concepts have flourished. 

A cloud-kitchen is an asset light model that allows you to serve takeaway and delivery orders using the same setup that you use for catering to dine in. The benefit – low cost of launching a delivery only brand and possibility of creating a new source of revenue by tweaking your menu based on local preferences.

Why Cloud Kitchens Make Sense in Post-COVID India? 

Who doesn’t want things to get back to normal – and resume their business operations. But till the virus is defeated, everyone has to practice restraint and adhere to lockdowns. 

Cloud kitchen concept, in such a scenario, has made fortunes for thousands of restaurant owners through the lockdown. 

 

Leave the lockdowns aside, the concept of cloud kitchens make sense in the modern F&B setup otherwise, too. 

Rising real estate prices in urban areas, increase in delivery orders (thanks to internet penetration), easy availability riders and low overheads have made cloud kitchens suitable for the capital-heavy F&B businesses. 

A cloud kitchen owner doesn’t have to think about breaking even every day, thanks to the improvement in food storage technology and the possibility of curating a menu based on consumer preferences (thanks to data science). 

Also, food deliveries will continue, thanks to the increasing middle class young population, no matter what. 

Turning Your Existing Restaurant into a Cloud Kitchen 

Think about it for once – you already have the required licenses, you have an idle staff waiting for engagement, you have the equipment, and a lot more than that. 

You can quickly convert your restaurant into a cloud kitchen – with diverse sub brands and interesting menus using the same ingredients that you’ve been sourcing from your vendors. 

If you’ve been running your restaurant from a rented premises, transitioning to a cloud kitchen model would work wonders. You can shift to a smaller place and save on rent, without compromising on servicing delivery orders. 

The possibilities are endless, and lucrative too. Feels better than waiting. Right? So, let’s look at how you can convert your restaurant into a cloud kitchen: 

Finalize a Menu for your Cloud Kitchen Brand

You can begin with your existing menu if you don’t want to risk it all. But cloud kitchens work great when you have options to cater to the curious foodies, bored of eating at home. 

So, if you’re into traditional recipes, you might spice it up a bit with a tinge of fusion or adding a completely different line of preparations to appeal to the young audience – something easy to cook for your staff, convenient to pack and delicious to enjoy at home. 

Some interesting and evergreen cuisine ideas that will appeal to young audience include: 

• Quick service brand offering sandwiches, burgers and pizzas 
• Quirky Chinese takeaway joint with dishes that are quick to prepare and can delight when delivered as bento boxes/box-style meals
• Biryani joint that doles out biryanis in earthen pots 
• Wraps, rolls, burritos and food that can be eaten by one hand 

Reactivate Your Suppliers & Vendors

You’d need all the support from your existing vendors and suppliers to make your venture successful. If you’ve halted operations during the lockdown, you need to start activating your suppliers again. 

Try sourcing items like semi-cooked/frozen products that can be used in an assembly-line setup and helps your staff prepare stuff quickly. 

Keep in mind that you might need to look for different vendors in case you’re completely changing your menu. So, it is better that you start looking for contacts around.

You’d need all the support from your existing vendors and suppliers to make your venture successful. If you’ve halted operations during the lockdown, you need to start activating your suppliers again. 

Try sourcing items like semi-cooked/frozen products that can be used in an assembly-line setup and helps your staff prepare stuff quickly. 

Keep in mind that you might need to look for different vendors in case you’re completely changing your menu. So, it is better that you start looking for contacts around. 

Convert Your Restaurant Kitchen into Cloud Kitchen 

A conventional restaurant kitchen is equipped with a lot of stuff, which you might not need for running a cloud kitchen. 

If you finalize a menu that needs assembling more than actual cooking, then you can get away with heavy stuff (put it back in storage) and make space for more assembly counters. 

The essence of conversion is to make preparation of dishes as simple, quick and convenient as possible. Remember, time matters in takeaway orders. You don’t want to spend 60-minutes preparing a simple recipe and leave your patron hanging on line with your front desk. 

Get inspiration from automobile-style assembly lines as you see in big chains like McDonald’s or Dominos. You will crack the code quickly based on your menu selection. 

Set up an Online Food Ordering Setup 

While food aggregation platforms might be on your mind when thinking of delivery only brands, it might not be the best option for you.

The commissions on serving orders that come via food ordering apps are high and can eat your margins deeply. A better solution is to launch your own food ordering platform using available tools and platforms. 

You don’t need a lot of investment to begin these days and everything can be operational within a week.

Want to Get Online? Here’s The Process to Turn Your Restaurant from Offline to Online 

Market & Promote Online 

Now this part might be something you’re not used to frequently. But if you want your cloud kitchen to be successful, you need to come out of your shell and engage audience online. 

You can take help of a freelancer or an agency (if you have spare cash) or can DIY your way by using free resources available online. 

 It is important that you have an appealing brand identity and maintain consistency on social media platforms. Engaging local influencers and using new formats like Instagram reels can give you desired mileage, initially. 

Three Commandants of a Successful Cloud Kitchen Brand 

Be Quirky

You need to create a unique brand for localities. So, you need to add local flavor to your online marketing activities. You can appeal to young audience via memes, moment marketing and/or doing something that is specific to the culture or region too.  

Don’t Overwork the Menu

Delivery orders are supposed to be simple and quick. So, don’t go into complicated recipes or items you know would spill during transportation. Keep it simple and interesting. 

‘Brand’ to Be Different

When you’re running a cloud kitchen, you don’t have a storefront to flaunt. Your virtual identity is everything – from logo to packaging, menu to social media handles. So, better you focus on something that makes you memorable, relatable and interesting. 

 

FAQs 

Is cloud kitchen a good business?

If you’re looking to launch a low-cost, sustainable food business post-COVID-19, cloud kitchen can be an interesting option. There are low overheads and one can grow organically (or via aggregators) to get orders with great margins to sustain and build a bigger food business in the future. 

Right now, cloud kitchens are a great option for aspiring foodpreneurs, considering people are open to ordering online. 

What is the business model of a cloud kitchen?

Cloud kitchens come in all forms and shapes in the present times. Talking of their business models, they can either be a standalone brand operating a ghost kitchen with no outlet/storefront and just an online order platform or can be like Fassos which operates multiple brands under a single umbrella with a specialized menu to tingle the taste buds. 

Then, there are aggregator-owned cloud kitchens too, which promise order volumes, finance and more, without worrying about scalability. Every cloud kitchen earns money through food deliveries and takeaway orders and needs to keep a check on overhead costs and wastage to be profitable in the long run. 

Can we start a cloud kitchen from home?

Yes, you can. But you will need to make arrangements to set up a fully functional cloud-worthy kitchen – which means you will have to upgrade heavily from your existing cooking equipment. 

Plus, you’ll need the requisite licenses from authorities, your society (or RWA), and a NOC from your landlord (in case of rented accommodation). Honestly, it will be too much hassle if you are living in a society and your neighbors complain. So, it is suggested that you rent a place in the commercial area of your city for smoother operations (and minimum disruptions). 

 

Final Words 

People won’t stop eating, ever – but their eating preferences would change from time to time. As a foodpreneur, you need to improvise, every single time, if you want to stay relevant, survive and grow in these tough times. 

Cloud kitchens have opened up an interesting opportunity in these testing times for the entire industry and every big player is dipping their hands into the pie. 

So, what are you waiting for? Why not start a cloud kitchen today in your existing restaurant setup? 

Need handholding support for your new venture? Let’s talk and plan it out together today