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A virtual restaurant in Columbus, Ohio in 2020

A virtual restaurant, also known as a ghost kitchen, cloud kitchen or dark kitchen, is a food service business that serves customers exclusively by delivery and pick-up based on phone and online ordering.[1] Virtual restaurants are stand-alone businesses that either operate out of an existing restaurant's kitchen or from a separate kitchen set-up away from a restaurant.[2][3][4] By not having a full-service restaurant with a storefront and dining room, virtual restaurants can economize by occupying cheaper real estate.[5][6] The reduced space lowers overall overhead and operational costs, thus yielding higher profit margins, as the price of the food provided is typically not changed.[7] The virtual restaurant's single kitchen format allows for multiple brands to share kitchen space.[2][8][9]

Background

With the rise of urbanization and an increasingly busy lifestyle, the demand for food delivery services has surged, resulting in a shift from traditional dining experiences to ordering food online.[10][11] Virtual restaurants gained significant notice during the COVID-19 pandemic in 2020, when many restaurants were either completely idled due to restrictions on public dining, or curtailed significantly as very low numbers of patrons were permitted to be served on-premises even as the situation recovered.[12] At the same time, demand for home delivery of food expanded as people were required to stay at home. Ghost kitchens helped brick-and-mortar restaurants recoup their losses and minimize employee layoffs by allowing them to prepare food for multiple brands and keep themselves in business.[13]

Virtual restaurants are set up within existing restaurants, allowing businesses to cut costs by sharing space.[8] Virtual restaurants also save money by avoiding dine-in service through reliance on delivery service. Virtual restaurants rely on their own delivery drivers or third-party delivery apps such as Grubhub, Uber Eats, Postmates and DoorDash to deliver food to customers.[2][3][14]

A typical virtual restaurant location is able to accommodate the preparation of several different types of cuisines.[15][16] The strategy of having multiple brands and cuisines can target a broader range of customers. Food can be prepared by specialty chefs or any range of cooks. Virtual restaurants are intended for people looking for professionally-cooked food with the convenience of local delivery.[6]

Function

The lack of a physical location allows companies to experiment with new menus, brands, and concepts with ease and low risk. Menus can be adjusted to match current trends or target multiple demographics with a variety of cuisines.[13] The online nature of ghost kitchens makes it possible for virtual restaurants to track customer data and analytics through the food ordering process and make data-driven decisions. They can track the popularity of items, wait times, and customer feedback via ratings and adjust their menus accordingly.[6]

Criticism

Ghost restaurants have been criticized for unpleasant working conditions, cramped and windowless kitchen spaces, and acting as fronts for other restaurants.[17][18][19]

In the United Kingdom, restaurant operators The Restaurant Group and Casual Dining Group were criticised in 2019 over a lack of transparency regarding virtual restaurant brands. The companies were found to be operating several virtual brands which sold similar or identical food to their more popular high-street brands.[20][21]

List of associated chain restaurants

Several virtual restaurant brands have associated brick-and-mortar locations. The following are virtual restaurants known to use ghost kitchens.

See also

References

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