Although in existence for a few years now, since the pandemic, the cloud kitchen business has taken off like never before. With both new and established players entering the fray to cater a wide variety of cuisines and experiences, the possibilities are endless.
With the boom in food delivery services across recent years, commercial kitchens have taken on a wholly new life of their own. While earlier, these would necessarily be attached to multi-outlet restaurant brands or hospitality groups, today, having evolved to the form of cloud kitchens, these facilities often also support standalone brands with no brick-and-mortar setups.
It was the digital revolution that helped the commercial kitchen evolve to the cloud kitchen, with a host of tech behind the slick interface of the digital storefront enabling real-time order turnaround and inventory management. This essentially means less investment, low maintenance costs and yet, wide visibility through digital platforms.
With the pandemic breaking out last year and working from home, social distancing and quarantines becoming normalised, the delivery model has only grown in relevance and importance, paving the way for an even brighter future for cloud kitchens.
Says Sabir Shaikh of Sabir Bhai’s, “The hospitality industry has gone through several layers of changes in 2020. The cloud kitchen industry has evolved on a large scale and witnessed a new rise in demand during this time. Since dine-in at restaurants was shut, this left people with only the option of ordering in. With the rise of food aggregators, the cloud kitchen business has proved to be both feasible and profitable.”
Restaurant and hospitality groups, already operating commercial kitchens for decades, are using the cloud kitchen format to serve other needs too.
“One part of our plan with cloud kitchens is to optimise the use of existing kitchens and resources from our restaurants such as Smoke House Deli and Social, and create parallel brands within these kitchens. The other part is to set up individual cloud kitchen brands at locations where we don’t have restaurants. We are currently ready to service seven brands and going ahead, depending on how they fare, we will add more brands to the list,” says Jaydeep Mukherjee, cloud kitchens operations manager for Impresario Handmade Restaurants.
For yet others, such as Raja Sekhar Reddy, Founder and Director, Squaremeal Foods, the cloud kitchen model serves to keep the brand’s restaurants Mirchi and Mime and Madeira and Mime in Mumbai’s Powai, fresh in the mind of the diner and create a restaurant-like experience at home. “Convenience and hygiene have become the priorities of consumers. Keeping these factors in mind we have conceptualized the Squaremeal BOX that one can order anytime. We want to offer customized meal in a box that gives you the experience of the restaurant,” he says.
With F&B revenues dropping sharply through last year’s lockdowns, resource optimisation is the need of the hour and a primary motivator for many restaurateurs taking the cloud kitchen route.
“We already had a space for Mag Street Kitchen, and the Mag Street Bread Co. is running out of here. So, the launch of our cloud kitchen Iktara was a natural progression for us to make best use of these resources at our disposal,” says Gauri Devidayal, co-founder of The Table and Iktara, among a number of other brands.
Despite the advantages of the cloud kitchen format, there are certain areas where it’s difficult to compete with brick-and-mortar restaurants.
“A restaurant gives you the opportunity to express your brand story, vision, concept, food and service, among others,” reveals Shaikh, adding that he would have considered opening up a restaurant if not for the pandemic.
But it’s not smooth sailing for players with restaurants either. Jaydeep explains, “A kitchen that is set up to cater to one or two restaurants, when extended into the cloud kitchen model, needs added infrastructure and staff.”
Perhaps the biggest challenge for the format are delivery logistics. Time and again, restaurant and hospitality groups have expressed their frustration with the steep charges levied by delivery aggregators. Impresario has hit upon a working alternative, as Jaydeep elaborates, “Although we’ll continue to work with aggregators, we also have our own delivery platform. Using our own staff and in-house fleet makes a lot of economic sense. Besides, our own platform helps us reach out and connect with customers, which is not something we can do through aggregators.”
The delivery format also brings into focus packaging, one of the few ways in which brands can connect with customers and one of the few forums on which to express brand vision and identity.
“Packaging is the key to cloud kitchens and innovation in that segment would help the sector on a huge scale. Innovation, not just in design but being eco-friendly, economical, temperature control to maintain the freshness of the food and to keep it hot until it reaches the customer,” says Sabir.
For Gauri, who started up a new pizza delivery brand Mag Street Toppings recently, personalisation in packaging makes a world of difference. “It wasn’t just about putting a pizza in a box and delivering it. It was also about what went on the box, whether it’s a playlist or the reheating instructions. We design the box with containers for oils, etc. The entire idea is to provide the customer with a restaurant-like experience, even at home. Attention to detail is very important for our brand.”
With all its pros and cons, the concept of cloud kitchens is here to stay, a fact that is evident in new brands and services popping up, even as the government races to vaccinate citizens and return life to a semblance of normalcy.
Zorawar Kalra, founder and director of Massive Restaurants, and an industry veteran, recently launched the group’s own cloud kitchen brand, Butter Delivery. His approach is a simple one – to engage the diner with a focused menu. “Our well-defined menu sets us apart from the competition. It is the most focused menu we have ever done, comprising only 10 dishes which are favourites, such as butter chicken, paneer makhani and special version of tandoori chicken,” he says.
While the brand has started out in Delhi NCR, Kalra plans to expand to nine Indian cities going ahead. Obviously, with resource utilisation and investment at this time being major concerns, he is also considering the plug-and-play model for kitchens. “It is better not to build your own kitchen because there are so many people now that have readymade kitchens for a fraction of your running cost. That’s a major relief on capital expenditure and a great way to expand your network.”
And it’s not just Indian cuisine that is making a splash with the cloud kitchen business. Despite an increased focus on local cuisines and home-style food, businesses have their hopes pinned on the section of diners who, owing to a lack of travel opportunities, are eager to explore international cuisine from home. Case in point, the launch of Soba Asian Delivery Kitchen in Mumbai which offers flavours from China, Thailand and Korea.
Cloud kitchens may have originated some time back but it’s only recently, with a massive shift in lifestyle since the pandemic, that the concept has taken off like a rocket. With a mix of both new and entrenched players catering everything from curated gourmet menus to simple, home-style dishes, the possibilities seem endless. It will also have enormous impact on associated industries such as dine-in restaurants and delivery service aggregators. How it plays out remains to be seen, but one thing is certain, the ultimate winner will be the consumer.