Digital tools to manage a dark kitchen

Discovered your favorite restaurant via a home delivery app? Confinements and teleworking have you used to ordering your lunch on the Internet? If so, you have probably unknowingly succumbed to dark kitchens, a new trend in the restaurant world.

What is it about ? What are their logistics, marketing and management needs? What digital tools do they need?

Dark kitchen: what are we talking about?

This term, which could be translated as “ghost kitchens or virtual restaurants”, applies to different players in the same sector:

  • Dark kitchens in the strict sense of the term : an existing restaurant or one created especially for the occasion rents kitchen space so that its teams cook its menus under its own brand, but without room service, only for delivery;
  • Kitchen as a service (KaaS) : a company offers its kitchen services and prepares meals in its premises on behalf of a third-party restaurant, respecting the recipe communicated by the principal, with a franchise model;
  • Virtual Kitchens: these companies are developing virtual restaurant brands and selling these concepts to existing restaurants wishing to diversify their business. Virtual kitchens then receive a percentage of the revenue generated by the restaurant;
  • the Kitchen Aggregators, generally managed by delivery platforms, which provide huge cut-out kitchens to increase the number of brands referenced in their applications. The platforms then receive a commission on the delivery, but also a share of the profits;
  • the Property-Kitchen, which only provide premises, on the model of coworking spaces. Unlike Kitchen Aggregators, these players are separate from delivery platforms.

dark kitchen

In all cases, the kitchen is turned, exclusively, or mainly towards delivery.A marketing method that exploded during the health crisis, to compensate for the administrative closures of restaurants.

Some numbers

In the 4th quarter of 2021, 56,000 brands were present on third-party platforms (Uber Eats, Deliveroo, JustEat):

  • 11.6% (6,500) were virtual brands sent from existing restaurants;
  • 2.3% (1,300) came from 150 pure Dark kitchens, ie only working in delivery.

Why launch a Dark Kitchen, ex-nihilo or in addition to an existing activity?

The main advantage is obviously economic: by turning exclusively to delivery, many costs are reduced or even eliminated:

  • the cost of real estate is lower, because it is obviously not necessary to have a reception room, but also because a Dark kitchen does not have to bet on its window to sell. It just needs to be well referenced on the platforms, guaranteeing rapid delivery (less than 20 minutes) and quality products;
  • the payroll is also reduced, in the absence of table service.

Dark kitchens can grow very quickly, and reach, with delivery platforms, a much larger audience than that of a traditional restaurant.

Finally, it is an extremely flexible formula. For Jean Valfort, entrepreneur in this sector, it is estimated that the investment to open a Dark kitchen is 6 to 10 times lower than that of a traditional restaurant. [1]. It then becomes much easier to test a concept, a product, or a geographical area.

Many dark kitchens thus offer several brands at the same time, to segment their clientele and their marketing discourse. The same Dark kitchen will thus be able to run several virtual restaurants on the same delivery platform. On average, a Dark kitchen uses 7 brands per address.

Dark kitchens

Automating administrative tasks, a strategic challenge for dark kitchens

Dark kitchens are most often light structures, with:

  • high logistical requirements, because delivery in less than 20 minutes is an important referencing criterion on platforms;
  • and marketing entirely or almost entirely online.

According to some estimates, a Dark kitchen would be profitable from 100 orders per day. One of the main challenges is therefore to save as much time as possible on tasks that can be automated or simplified, in order to focus on production and order tracking.

Among these tasks, collecting supplier invoices, sorting them and paying them is a particularly time-consuming job for the restaurateur. However, solutions exist. With real experience in this sector, Libeo allows restaurateurs to save an average of 3 days per month [2].

Other tools may prove essential, particularly in terms of digital marketing, to establish the brand on the internet and social networks, and retain customers who, by definition, will not be able to pass the door of the restaurant :

  • creation of a dedicated website;
  • regular publication of news on a blog and social networks;
  • regular newsletter to communicate about new recipes and regular promotions.

Regarding order management, most Kitchen aggregators offer complete support, including an order management application, right up to delivery tracking.

Dark kitchens: legal and accounting difficulties

As often, innovation has gotten ahead of the legislator. It is therefore not always easy to bring dark kitchens into existing regulatory frameworks. The specificities linked to this new type of activity are numerous, but we can mention in particular:

  • more flexible contracts than the traditional 3/6/9 commercial lease, most of the time with service provision contracts (on the coworking model), or derogatory leases ;
  • generally much lower fixed costs than traditional restaurants;
  • significant commissions, taken by the delivery platforms on each sale, even franchise contracts in some cases (in the case of Virtual Kitchens in particular).

This new mode of exercise also raises the question of the evaluation of goodwill, which is more difficult to quantify in the presence of a virtual brand. Technical issues and technological needs are therefore important, but it is no longer possible to ignore this phenomenon, whose turnover should almost double over the next 5 years.

[1] BFM Business interview, December 18, 2020

[2] Source: Libeo study

Libeo

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