It is a looming reality that the cloud business model is here to stay with us for years to come. Among the businesses that have seen success are cloud kitchens, thanks to online food ordering becoming commonplace across the globe with lockdowns and social distancing becoming the norm. This now social lifestyle has spawned cloud kitchens as the new business category for entrepreneurs who have cooking / culinary skills. Best wishes as you begin your journey to starting a cloud kitchen.
What is a cloud kitchen?
A cloud kitchen, sometimes also called “the virtual kitchen,” is a kitchen space used for commercial purposes to provide end consumers and food businesses the facilities and services needed to prepare menu items for delivery and takeaway. Cloud kitchens allow better survival and growth opportunities due to minimal overheads.
Given the popularity of experimental food & the growth of the delivery services model, anyone can open a cloud kitchen business with appropriate guidance from business and digital marketing experts. Read this article to learn about the basics of setting up a cloud kitchen and start taking orders for your food business in no time.
Starting A Cloud Kitchen
Choosing a Location for your cloud kitchen
The location is the most significant difference between a restaurant and starting a cloud kitchen. The key things to be kept in mind are space for all equipment, sanitation arrangement, adequate water supply, and electricity. Your cloud kitchen should be closer to your target audience, which would like the types of food you plan to prepare and accessible enough for the delivery agents to reach out efficiently with minimal parking space.
Among the main reasons to start a cloud kitchen is low rental and infrastructure cost.
Acquiring all the required licenses for setting up a cloud kitchen restaurant
Licensing is a compulsory part of opening any business, be it a regular dine-in restaurant or a cloud kitchen. Some of the licenses you will need are the FSSAI license, Health Trade license, GST registration, etc. This will be easier once you have a business consultant or marketing consultant as they will be able to show you how to acquire the licenses easily.
Deciding a budget for setting up the kitchen
Next up is the cost of the setting of your cloud kitchen. One of the critical inputs is the essential equipment & heavy equipment you require to deliver as per the cloud kitchen menu. You can save some money by getting some stuff from the recycled or used market like old tables, storage racks, grinders, juicers, etc. The packaging and packaging materials are also part of the kitchen cost as you cannot deliver without these. The packing and packaging are also an important part of your marketing; don’t forget this.
Hiring manpower for your cloud kitchen venture
Quality of workforce is an essential factor for the service business and more so when it comes to food marketing business simply because small mistakes can spiral into social media negatives resulting in a drop in business. For online kitchens, a team of 5 employees is the least you will need—the ideal combo – two chefs, two cooks, one housekeeper, and one helper.
If you want to focus on the business, you will need a good chef whose duties are not just relegated to cooking but also inventory management, innovating new menu items, assigning responsibilities to cooks and managing food quality, and so on. A chef + cook combination ensures a restaurant kitchen’s smooth and effective functioning.
Managing suppliers & cloud Kitchen inventory
The Vendor / Supplier is a critical partner when starting a cloud kitchen business. Ideally, have 3-4 suppliers as there will be times when one will run out of stock, and you don’t want to refuse orders. Apart from the variety of goods the supplier can provide, maintaining quality and timely delivery is an important factor in choosing the supplier partners. Remember, these products will define the underlying taste of the food.
While finalizing the supplier, remember that ordering small quantities will cost you more, and to get better rates, you need to order just a little over the quantities you will require. Some products can be stocked for a month, while others should ideally be replaced at shorter intervals.
To get started, make a list of all the ingredients you need, get quotes and compare. Ideally, order the complete quantity of an ingredient from 1 supplier as it’s easier to ask for replacements and additional qty to maintain the taste and flavour.
Managing inventory is a challenge as multiple ingredients are required, and each in different quantities with perishability as a worry. This is a complicated task, but thanks to technology and systems, you can handle cloud kitchen inventory without much problem. Get an intelligent POS system, and you will manage the daily inventory smoothly and place orders as per requirements.
Gearing up for online deliveries
Taking care of the online ordering and delivery platforms is the next step after starting a cloud kitchen. There are several food delivery apps available in India like Swiggy, Zomato, Foodpanda, etc. These apps will take orders on your behalf and help you deliver the food. However, remember they charge a percentage of your revenue per order. You can also set up your website to order food online to provide cheap delivery services but going with delivery in the initial stages is a wiser choice.
Implementing a proper process for sales and delivery
Remember starting a Cloud kitchen is only half the job done, the business survives on orders.
The primary source of orders is the internet (website & apps), and then you have telephone and chat order options. Accepting and managing the orders can be a big headache for order taking and delivery with orders from various sites; hence a POS is required.
You can also use web-enabled saas tools like computers, tablets, mobiles order management.
Executing a Proper Marketing Strategy
Last but not least, your startup’s success depends on adhering to proper cloud kitchen marketing techniques. Marketing is critical not only to get orders when you start but, in the long run, will reduce your dependency on third-party apps/website orders, thus giving you some additional profits. Starting a Could kitchen requires marketing to improve visibility and build positive reviews on food review sites and social channels. Social Media Marketing on Facebook or Instagram for a cloud kitchen is recommended as an integral part of promoting a cloud kitchen business.
*Secret Tip: Train your staff to take pictures of exciting moments when the food is getting ready, and pics of the final products with some nice decorative elements like colored sauce, coriander or parsley sprigs, patterns on served plates, etc. make for excellent marketing material.
There you are ready to start a cloud kitchen. You can always hire us as your digital marketing agency to help you grow your business at the best ROI.