What is a ghost kitchen?
A ghost kitchen, also known as a shadow kitchen or virtual kitchen, is a business model where food is prepared and packaged in one location, but sold to customers through another location. The term “ghost kitchen” can also refer to a delivery-only restaurant, which means that it has no physical location for customers to visit. You can read more about the concept of ghost/shadow kitchen in this blog post.
Can I run a cloud kitchen from my house?
The answer to this question is yes, but there are some restrictions. In most cases, you will need to have a commercial kitchen space in order to prepare and sell food. However, there are some exceptions. For example, if you want to start a delivery-only kitchen, you can do so from your home as long as you meet the requirements set by your local government. People who are interested in starting a ghost kitchen from home should start by researching the requirements and procedures required to do so in their local area.
Starting your own ghost kitchen: step by step
Step 1 : Choose a business model
The first step in starting your own ghost kitchen is to choose a business model. There are several different models that you can choose from, each with its own set of pros and cons. The three most common models are:
a) Delivery-only – This is the simplest and least expensive option, but it also has the lowest profit margin due to high delivery fees. The main advantage of this model is that you don’t need any physical space or employees, which saves money on rent and labor costs. You can start a delivery-only kitchen from your home as long as it meets the requirements set by your local government (more on this later).
b) Kitchen space – This is the most traditional type of ghost kitchen model, where you rent out a commercial kitchen and sell your food through delivery platforms. The main advantage of this model is that it allows you to offer more variety in terms of menu items since there isn’t any need for physical storage space or refrigeration units. You’ll also have less delivery fees to worry about, since customers can come to your kitchen to pick up their orders.
c) Hybrid – This is a newer model that combines the benefits of both delivery-only and kitchen space models. In this model, you rent out a commercial kitchen for a set period of time (usually a few hours per day), and use it to prepare and package your food for delivery. This is a good option for small businesses that are starting out, as it allows you to test the waters without making a big financial investment.
Step 2: Study your competition
The third step is to study your competition. This will give you a better idea of the types of food that are popular in your area, as well as the pricing strategies that are being used. It’s also important to research delivery platforms and how they work. This information can be useful when it comes time to start marketing your kitchen.
Step 3: Determine your budget
The next step is to determine your budget. This will help you determine what type of equipment you need, as well as the size and location of your kitchen. Your budget should also include licenses and permits, as well as any other costs that might be associated with starting a ghost kitchen from home.
How much does it cost to start a ghost kitchen?
Advantage of cloud kitchen is that they’re a much lower on both upfront capital and ongoing operating costs compared to a traditional restaurant. You can get started in a ghost kitchen with as little as $20K, instead of $1M+ for brick and mortar restaurant. Delivery-only kitchens are usually the cheapest to start, while kitchen space models can be more expensive due to rent and equipment costs. It’s important to remember that you will also need to budget for marketing, licenses, and permits.
Step 4: Craft your menu
Another important step is to develop a menu for your ghost kitchen. This can be done by looking at the types of food that are popular in your area, and then brainstorming recipes that fit those categories. You’ll also need to decide on a pricing strategy, which will vary depending on the type of food you’re selling.
Knowing your customers is absolutely essential for creating a successful menu. You need to have a precise idea who you are going to serve your food for. Try to get a sense of their dietary restrictions, taste preferences, and budget constraints. This will help you create a menu that is both appealing and affordable.
It is best to start with a maximum of 10 items on the menu. More than that will make it difficult for you to keep track of inventory, and may also confuse customers who are unsure about what they want.
Step 5: Assess the space
Next step is making sure that the space you have in mind fits the needs of a cloud kitchen. If you’re going for a delivery-only model, then this means checking that your kitchen meets the requirements set by local governments. Running a commissary kitchen form your home can work, but it’s important to remember that you’ll need a way to keep food cold (either an industrial refrigerator or a few small refrigerators) and storage space for dry goods.
You also need to make sure that the location of your cloud kitchen is accessible so that delivery drivers are able to easily pick up orders.
Step 6: Find the right equipment
Once you have your space, it’s time to start stocking up on equipment! The type of equipment you need will depend on the type of kitchen you decide to start. For a full-service kitchen, you will need a range, oven, fridge, and freezer. For a limited-menu or delivery-only kitchen, you will need a microwave, toaster oven, and refrigerator. Take a look at our checklist of commercial kitchen equipment, to get an idea of what you need for your cloud kitchen.
Step 7: Get the right licenses
Finally, you will need to get the appropriate licenses and permits from your local government. The type of licenses and permits you need will vary depending on your state and municipality. For example, some states require an alcohol license for restaurants that serve alcoholic beverages. Other permits may be required in order to sell prepared food at all times of the day or night. Consult with your local government to determine which licenses and permits are required.
Step 8: Hire the right staff
Once you have all of the necessary licenses and permits, it’s time to start hiring staff. The most important positions to fill are chefs and managers. Make sure to interview candidates thoroughly and check their references before making a final decision. You may also want to consider hiring delivery drivers and customer service representatives.
How to get customers for your new ghost kitchen?
Now that you have everything set up, it’s time to start attracting customers! There are a few ways to do this. One way is to market your kitchen online and promote your menu items. A good place to start would be creating an Instagram account for your business, as well as Facebook and Twitter accounts. This will help you get the word out there and start building a following. Be sure to post pictures of your food, as well as updates on what’s going on in your kitchen.
Get your brand onto an app like UberEats or DoorDash, and start getting customers. You can also reach out to local businesses and offer catering services. Finally, word of mouth is often the best marketing – tell your friends and family about your new kitchen and encourage them to check it out!
Advantages of running a ghost kitchen from home
- Flexibility: You can work at your own pace, but also have the flexibility to work more hours when needed.
- Lower overhead expenses: The cost of starting up a cloud kitchen is much lower than opening an actual restaurant, so you don’t need as much capital upfront.
- Easy menu changes: There are many options for what type of food you want to sell and how you want to sell it. For example, if you are interested in selling Asian food but don’t have the space to do so, then starting a ghost kitchen from home is an excellent option because there won’t be any restrictions on what kind of cuisine can be sold or prepared at any given time.
- Save on space: You don’t need as much space for your business since you can operate out of a home instead of renting out an entire building like most restaurants do. This means that it’s easier to get started and less expensive too!
Disadvantages of ghost kitchens
- You may not have enough time or energy to work on your business full-time because you will also be responsible for other tasks such as cooking and cleaning.
- It can be difficult to attract customers if they are not aware that your kitchen exists. This means you may need to invest in marketing in order to get the word out about your business.
- You will need to comply with all health and safety regulations, which can be expensive and time-consuming.
Are cloud kitchens profitable?
According to the National Restaurant Association, ghost kitchens are more profitable than traditional restaurants. The top reasons for this include lower overhead costs (such as rent), higher profit margins from food sales, and less competition in your area. In addition to these benefits, ghost kitchens also allow you to work at home with flexible hours so that you can spend time with your family or pursue other interests while still earning money from the comfort of your own home!
Once you have everything you need, it’s time to start cooking. Make sure you have a good business plan in place before you open your doors. Having a strong business plan will help you stay organized and make sure you’re making money from day one.
We hope that this article helped you understand how to start ghost kitchen from home. If you have any questions, feel free to contact us. Good luck with your new venture!