UNDERSTANDING WHAT IS VIRTUAL RESTAURANT.
A virtual restaurant is basically a food service business that serves customers entirely by delivery based on phone orders or online food ordering. It is a separate food vendor entity that operates out of an existing restaurant’s kitchen. By lacking a full-service restaurant premise with a storefront and dining room, virtual restaurants can economize by occupying cheaper real estate. This is compared to a ghost kitchen, a co-working concept for meal preparation with no retail presence that a restaurant/brand or multiple restaurants can buy into.
Over 60% or more of new restaurants, cafes, or bars cease to function or fail within their first five or six years. The year 2016 was the first time in U.S. history that Americans spent more on prepared food than groceries. This may be the best time to start a virtual restaurant and not just your traditional brick-and-mortar restaurant. The virtual restaurant, which eliminates the idea for patrons to dine in your restaurant, is increasingly becoming more and more popular nowadays, just because of the rise of cell phone technology and the growing efficiencies of home delivery services.
In reality, investment bank UBS predicts food delivery sales to increase annually by almost 20%—from $35 billion to $365 billion worldwide by 2030. Virtual restaurants are transforming rapidly and becoming essential in most large cities like New York, Chicago, and Los Angeles. As time goes on, you will likely see more virtual restaurants throughout the United States of America and worldwide.
DEFINING VIRTUAL RESTAURANT
Virtual restaurants are also known as ghost restaurants. They are restaurants that provide a delivery-only dining experience accelerated through primarily digital apps and sometimes third-party services. These delivery-only restaurants alleviate conventional and orthodox expenses and overhead while giving clients a more enjoyable, fitting, convenient, and faster way to dine.
Virtual restaurants are day by day becoming more and more popular as modern innovations continue to improve the Internet user experience and the productivity, capabilities, efficiencies, and enticement of delivery services. Big or small, all types of companies and businesses are putting their trust and resources heavily in virtual restaurants and the technology that makes them possible. For example, GrubHub, one of the largest food-delivery spaces, not so long ago purchased LevelUp, a company that helps restaurants with digital payments and customer loyalty, for $390 million.
TYPES OF FOOD THAT SELLS BEST FROM VIRTUAL RESTAURANTS.
One of the main advantages of operating a virtual restaurant or a ghost restaurant is that you can easily use the riches of dynamic customer data provided to you for your benefit. For instance, you may search for the different types of foods and meals that sell best from virtual restaurants and pizzerias in your area on Google.
Here are some famous examples:
Chinese and Japanese food–sushi, noodles, spring rolls
Indian food–BBQ, chicken tikka masala, naan
Mexican food–tacos, burritos, nachos, taco salad
Pizza–make your own pizza with different toppings and crust sizes.
Mediterranean food–shawarmas and Greek salad
Fast-casual food–burgers, sliders, wraps, fried chicken, and fries
HOW TO SET UP AND RUN A VIRTUAL RESTAURANT.
The most important thing you should do is to, as soon as possible, set up a great, easy-to-use website for your virtual restaurant with an order form and delivery slots. For this, you can easily make use of WordPress and WooCommerce, so that you may have complete ownership of your virtual restaurant website. This is impossible with a hosted solution like Uber Eats, Deliveroo, and Just Eat.
If you don’t have a WordPress website, don’t worry and choose a hosting company to make your website easily accessible and available to patrons. It would be much better if you go with a reliable web hosting provider like Kinsta. Below are a few steps which would help you successfully set up and run a virtual or ghost restaurant.
Plan your concept to optimize for delivery.
The most significant drawbacks for Dine-in restaurants are the high costs of providing and maintaining the restaurant, renting the dining room, hiring more staffs and so many resources that need to be put in, legal restrictions in regards to operating and parking the vehicles of the guests, inconsistent sales volumes because of lousy weather or canceled events, problems shuffling food and supplies, and behind office difficulties and fees related with payments.
The brick-and-mortar restaurant kitchens are developed for in-person dining and service, which has challenges and shallow margins. Due to this, restaurants are starting to realize that delivery is now the most crucial burden, and their menu is not optimized for delivery in mind. In essence, building your concept needs optimizing for delivery. Time and temperature are massive obstructions for food quality and are the most considerable deliberation when developing a delivery-only concept. If your food arrives cold, soggy, or messy, you run the risk of killing your repeat customer business, which is the critical component of a local operation.
Firstly, you need to perfect your offerings, focusing on time, quantity, efficiency, quality, and taste. Secondly, you will need to give a 100% on simplicity, the versatility of ingredients, and consistency. Keep your ingredient costs low by offering a few standard menu items that use similar ingredients and preparation methods.
Determine your niche.
When kick-starting any small business, you need to do your lookup and look for a specific gap in your current market. Is there a precise audience that is exceptionally suited for delivery-only that you can serve? Employees? College students? Busy professionals? Special healthy diets? Mobility-limited seniors? Office complexes?
Investigate your goal demographics. Go out and engage or connect with Individuals on the streets and in your neighborhood. If you find there are already a bunch of 5-star-rated curry corners, restaurants, or food trucks that prepare curry and deliver in your area, it may be wiser not to compete at all. But if you are aware that there is a lack of ethnic meals or no clear winner for Late Night Burrito King, you may soon be carrying the crown.
Build your brand.
Because your total manufacturer will exist specifically online, you’ll need to put sources into developing a logo, menu, and different brand-related assets. Use Wix or WooCommerce to construct a webpage and use it as a source to advertise your story: let everyone know who you are and what makes your food unique, fresh, and healthy. Include your contact statistics for your commercial enterprise and hyperlink to your social media sites. Facebook, Snapchat, and Instagram are the most common systems for food businesses to connect immediately with customers.
Find a commercial kitchen.
To legally sell meals to consumers, you should produce your meals in a licensed industrial kitchen. The survey shows that the last 5 years have seen a growth in the quantity of shared-use kitchens or commercial kitchens that rent by the hour, day, or month to more than one tenant. To locate and rent a commercial kitchen in your area, visit The Kitchen Door, where you can search for rentable kitchens via city or zip code. Be prepared to reply to some questions that all commercial kitchens will ask:
A: “Is your enterprise registered?”
Contact your city or county workplace to apply for a commercial enterprise license. You will be required to complete an application and pay licensing fees.
B: “Do you have your ServSafe Food Handler Certification?”
This nationally recognized food safety course is offered by the National Restaurant Association and can be taken online or individually with a teacher or proctor. As the essential operator of your business, you may also be required to have a ServSafe Manager Certification.
C: “Have you selected your plan?”
Your kitchen will frequently require savings to get right of entry to their offerings. While many provide hourly booking and “pay as you go” models, you can additionally commit to monthly plans that might also come with a discounted hourly rate. Choose your graph-based totally on the days and instances you count on to be operational and usually account for prep time, set up, cleaning, and receiving hours.
D: “Do you have Liability insurance?“
So many shared kitchens want you to have a $1 million established legal responsibility coverage that designates the kitchen you work out of as co-insured. Such insurance plans commonly run between $300-$500 per year and will also be required by many service providers, vendors, and businesses you work with.
E: “Have you ever applied for Inspection?“
Nowadays, so many fitness and health departments will choose to visit you in your new area even before you start to operate from that particular area. They desire to see your manufacturing methods, food storage methods and areas, and prevalent flows that consider general working processes and integral manage points for making your food. You will need to have these written out for your final inspection and licensing.
Always remember that regulators at your nearby fitness or health department may additionally have no idea how to regulate your business. All they comprehend is that you fall someplace between a food truck and a restaurant. But also understand that your neighborhood regulator is one of your most important allies for gaining access to accurate records and remaining a legal operation. What they want to comprehend is that you are producing food safely and legally. Walk them through your menu, your production process, how you layout to maintain time and temperature, and what third-party carrier providers you design to use. Remember, You need them on your side.
Select your service provider
You are expected to research, analyze and secure a food distributor and provider to deliver to your kitchen. While there are national brands, there are also some super cool local suppliers to think about, particularly if you would like to include specialty or locally raised or grown food as a worthy addition. Your most significant supplier is your online food delivery service.
These firms charge a commission in exchange for providing one in every of the foremost vital aspects of your business’s success. You’re leveraging a technology platform that somebody else inbuilt to attach with customers, receive online orders, and supply reliable delivery fulfillment.
Remember that enclosed within the service is the cash you save finding customers and promoting your thoughts. Instead, hungry folks are returning to a digital marketplace and are ready to notice you. Several service suppliers can permit you to procure further visibility via banner ads and exposure at the highest of the search rankings. Once selecting a supplier, you ought to resolve which services in your area and appraise the ordinary delivery times, responsibleness, and client service.
Many still balk at the commission fees, typically up to a painful half-hour; however, place confidence in it within the larger context of your operation: time and cash saved for a more extensive client reach. In the end, you’ll still seemingly take off on prime. Folks have already compared many suppliers to decide for themselves. Note that these delivery firms are competitive with one another. Therefore rating could have been modified. consider their websites for the most recent information:
Launch and ingeminate.
The golden rule is “Keep it simple but unique.” select ingredients you’ll be able to use in multiple things to decrease food prices and waste material. You ought to conjointly do central testing before delivering something to a paying shopper. Target quality food that travels well holds the temperature and arrives as meant.
To do this, check your food “in situ” or within the actual delivery take-out containers, you may be making use of. Web restaurant has lots of take-out instrumentation choices to settle on from. raise your suppliers to send you samples; therefore, you’ll be able to check them out along with your food. (Someone must write a journal on the innovation in delivery packaging and compare the simplest ones.) The best company to look at during this time is Soggy Food Sucks. However, we’re positive there are others.
Practice packing up your food and delivering it. Have a high-quality management person act as a liaison between the cook and the delivery service. Confirm to double and triple check the orders to incorporate the correct supplies (napkins, utensils, sauces, sides, drinks, desserts, etc.). There’s nothing like obtaining delivery, solely to search out that your son’s pad thai is missing. Another piece of recommendation to save lots of cash and waste is to form sauces, plasticware, napkins, and condiments accessible by request solely at consideration. Everybody features an untidy drawer choked with plastic spoons, salt and pepper packets, and condiment packets that go unused. You would possibly save yourself and your customers by material possession people opt-in.
Likely the foremost worst part of beginning a delivery-only restaurant is building customers. Just because there aren’t any signs or locations to drive by and see accidentally, you may get to connect with customers in artistic ways, as well as flyers, ads, word of mouth, events, etc.
Post your menu offerings on an internet site. Have consistent and reliable hours; therefore, customers recognize after expecting you to be accessible and may order the things they need. Be consistent and artistic with how you utilize social media to make a following. And confirm you evoke reviews of your food. Be conscious of your community and customers. Hear the feedback from your community and answer their desires with a differentiation. Fill a gap. This is how you will find product-market fit.
ADVANTAGES OF VIRTUAL RESTAURANT.
Here is some benefits ghost restaurants offer that traditional eateries can’t:
The flexibility of concept: Being app- or web-based means that you can transform your menu whenever you like, without having to panic about updating signage or printed materials.
Adjustable menu: If an ingredient becomes too expensive or is no longer accessible in your area, you can easily swap out your menu items to suit what is available to you.
Smaller financial investment: Think about all the expensive elements that don’t apply to virtual restaurants: decor, signage, dinnerware, and additional staff members to serve as servers or hosts.
Opportunity for experimentation: Ghost restaurants are the perfect opportunity to experiment with new concepts because you can quickly scrap ideas that aren’t working.
FEW DANGERS OF VIRTUAL RESTAURANTS.
While there is no contradiction that delivery is here to stay, restaurateurs have an essential decision to choose what their brand means to them. With the food delivery market expected to grow to $365 billion throughout the world by 2030, restaurateurs no matter be they franchisees or sole proprietors all have been patiently searching for ways to capitalize on the delivery boom, both because it is operationally prudent but also because customers are asking for it. Third-party delivery platforms, like Uber Eats and DoorDash, have only accelerated this growth, so much so that an entirely novel type of restaurant has been increasingly emerging in major cities, delivery-only or virtual restaurants.
These virtual restaurants or ghost restaurants, complete with delivery-only menus and quick turnaround times, offer what seems like a one-size-fits-all solution to both the delivery boom and the staff turnover woes that operators grapple with daily. They alleviate overhead costs since they don’t have a dine-in option, limiting the number of employees and real estate necessary to operate. Additionally, these ghost kitchens create a treasure trove of data on customer behavior.
1. Third-party delivery platforms eat brands
Uber Eats, GrubHub, DoorDash, and other third-party delivery platforms have increased exponentially in recent years.
Around 44 million U.S. smartphone users will use third-party food delivery apps by 2020, representing a 6 million increase compared to 2019.
Positioning themselves as a flexible and convenient way for restaurants to provide delivery services without directly managing a delivery force while also providing marketing and discovery services that many restaurant operators simply can’t afford, the platforms offer an appeal that is admittedly difficult to deliver to pass up.
2. Personal touch is essential
“Please and Thank You” and “The Golden Rule” are staples of the child-rearing process for a reason.
Personal interactions are the foundation of reputation and relationship building.
In a restaurant, the importance of personal interaction is heightened, as a good or bad experience can mean winning a loyal customer or poisoning the well of a person’s network.
This same ideal lends itself to virtual restaurants and last-mile delivery.
If a customer only views a restaurant as an interchangeable place on a delivery app, there is little to no room for meaningful interaction.
A virtual restaurant loses its opportunity to put a proverbial ‘face to the name by not having a dine-in option.’ Furthermore, by outsourcing delivery to a third-party service, a restaurant cedes control of the customer experience and necessary personal touch that might lead to a repeat customer.
3. Hands off my data
Virtual restaurants certainly offer a lot of flexibility and convenience by being online-first. And while an operator may be able to discern what items are most or least popular based on aggregate order history,
There’s a significant disconnect in the data they do have versus what they should.
By relying on third-party platforms for discovery, ordering, and delivery, virtual restaurants lose a considerable advantage to restaurants that manage delivery in-house – data!
We live in the era of data, yet virtual restaurants are throwing away storerooms of data to these third-party services that they might otherwise use to connect with their customers, devise new marketing campaigns, and ensure safety and trust with their hard-won customers.