If you desire to be a foodpreneur then thinking of a cloud kitchen business in India is quite an opportunity in the current scenario.
In this Covid-19 pandemic, with people locked up indoors and not much opportunity to dine-out, food delivery became the nation’s go-to option.
The online food delivery market is projected to grow from a $35 billion industry to $365 billion by 2030. Considering the high rentals and the increasingly thinning margins, restaurant operators are now closing up the storefront altogether and moving towards the more economically profitable, Cloud Kitchen business.
What Is A Cloud Kitchen
A cloud kitchen, also known as ghost kitchen, is a delivery-only restaurant that offers no dine-in facility.
Cloud Kitchens accept orders online through food apps or through WhatsApp. This business model is considered as a low investment, low risk, yet high on profit format since the setting up cost is significantly less as compared to a traditional dine-in or takeaway restaurant.
So let’s look at the opportunities and challenges of the cloud kitchen business model.
India’s Demographics: Opportunity For Cloud Kitchens
India is an opportunity market with a large population away from their homes for education or employment, the millennials are highly dependent on online food ordering apps.
The changing lifestyle patterns of urban India – high disposable incomes and busy schedules – further add to the demand.
Cloud Kitchens: Economically More Profitable Than Dine-outs
Since there is low investment and risk, cloud kitchens are one of the most profitable food business models.
A cloud kitchen takes one-third of the time and resources and also you don’t need a kitchen at a prime location. Plus you don’t need to spend on the interiors and furniture. You can always invest in low cost rentals to start this. It can very easily be set up in a 250-300 Sq Ft space. So this brings down the overall cost significantly.
Small Team Management
You can easily open a cloud kitchen with 3-5 people who’d be focused on preparing and delivering the food. It is advisable to start small and then you can hire more staff based on the incoming order volumes.
Pandemic Accelerated Shift In Market
Though this concept of cloud kitchens is still very nascent but the pandemic has accelerated the shift towards delivery-only models in India.
Challenges Are Indispensable.
Licenses and certification is necessary for opening a cloud kitchen because it saves you from the legal hassles and since customers cannot visit the outlet and check for the hygiene, food safety, and preparation themselves, having proper licenses gives them a sense of trust and satisfaction.
The major licenses required to start a cloud kitchen business are FSSAI, GST Registration, NOC from the fire department, etc. Do ensure that you have these in place before starting a food delivery business.
Technology For A Cloud Kitchen Business
A cloud kitchen typically relies on online food aggregators and mobile food apps to generate orders, so technology plays a crucial role. So you need to integrate your business with these food delivery apps for aiding operations.
If you are in Bangalore, You can register your business with YummJoy Mobile App for Cloud Kitchen Business!
Generating Online Orders And Marketing
A cloud kitchen relies on online and telephonic food orders, it is essential that you wisely spend on marketing, at least in the initial days.
As a new business, you need to align with food aggregators and food apps to help you reach your target audience easily.
Optimizing Online Food Delivery
Generating orders and preparing food is just one part of the cloud kitchen business. The bigger challenge is delivery and ensuring that your food is reaching to your customers on time and in perfect condition. So it’s advisable to tie-up with third-party aggregators or logistics companies or have your own in-house food delivery fleet to fulfill orders.
Consistency In Quality And Service
In a cloud kitchen business the consistency in quality and service plays a crucial role. You need to focus on the food prepared and need to have food packaging planned in such a way that it will be in transit for another 15-30 minutes and should avoid spillage and food going cold.
Moreover timely delivery is another factor that adds to customer experience and retention. So be prepared for challenges like difficult delivery locations, peak hours, late nights, weather, or festive rush etc..
Winning Customer Loyalty
Winning customer loyalty is a key factor to repeated orders. You need to identify the unique value proposition and live up to it to win your loyal customers in the competing zone.
Running a cloud kitchen business is not difficult but comes with its pitfalls. The key is to simply navigate through them with clear business goals, unique value proposition, prudent use of capital and technology, and unmatched customer experience.
Turn Your Passion For Cooking Into A Business
If you are passionate about cooking and want to sell your home-made food in Bangalore. Register yourself now on YummJoy and turn your passion into the foodpreneur in you.