Starting a new restaurant from scratch is hard. Most close within the first five years, and many within one year. One of the biggest drains on a restauranteur's up-front investment is real estate, especially in a city. That's also where the competition is strongest. More restaurant failures in the last couple of years have been in dine-in establishments -even before they become established. But people gotta eat, so landlords have stepped in to fuel a rising trend: ghost kitchens. They are just kitchens, no dining area, and they are often shared spaces.
Similar to food trucks, the appeal of ghost kitchens is simple: They’re a way for people who have dreams of starting a restaurant, but are worried about the overhead costs, to do so without risking losing the entirety of their investment. The idea is that a ghost kitchen, which allows for multiple “restaurants” to produce food using the same physical space while also sharing equipment and ingredients, will cost a fraction of opening up a brick-and-mortar restaurant. “With a ghost kitchen, you rent from a landlord at a facility like Kitchens United or CloudKitchens, usually located in densely populated areas,” reports Roaming Hunger. “From there, you get your brand onto an app like Uber Eats or DoorDash, and (hopefully) start getting customers. Then you send out orders from the rented kitchen space. Ghost kitchens can be used to launch an entirely new business, or to expand the delivery range for an existing brand.”
The question is, how does this affect small eateries that already exist? No one knows yet, but it could be like the way newspapers are going bankrupt now that everyone can get information online. Read about the trend of ghost kitchens at Mel magazine. -via Digg