Cloud kitchen is the future of restaurant industry in India with robust technology and lucrative business model
The concept of take-out or home delivery is no stranger to the food industry and the masses; rather, it has been around for decades, on a global scale. The term “delivery only, no dinner”, now called “Cloud Kitchen”, has been widespread in India for a long time in the form of traditional Dabba/Tiffin delivery services and mobile canteens (food trucks). With this, Cloud Kitchens had already established a successful tried and tested business model in India which has firmly established itself under the pandemic situation, which has been revamped with advanced technical assistance.
Generally, the idea of consuming food out on occasion immediately paints an image of an ambient dining experience in a restaurant, delicious dishes presented in luxurious cutlery, and celebrations with family and friends. However, cloud kitchens are making groundbreaking innovations in this area by bringing similarities to a restaurant dining experience at home by serving everything from simple home cooking to specialty and luxury dinners. According to industry experts, the Indian food service market is expected to double in value to $13 billion by 2025 and cloud kitchens are expected to be a $2 billion industry in India by 2024. compared to $400 million in 2019.
Cloud Kitchens – Factors responsible for its sustenance and growth:
With recent changes, the outlook for the restaurant industry has seen a rapid change from the perspective of customers and business owners. A few years ago, the home delivery business contributed only a small part of the restaurant’s turnover, which is now experiencing upward growth. Although the pandemic has acted as a catalyst in bringing about a major shift in the Indian restaurant industry from catering to delivery, many other factors have fueled its meteoric growth in India, including the increased internet penetration, the integration of technology into businesses, and the rise of food delivery based on mobile apps and online food aggregators.
The cloud kitchen market in India is expected to flourish over the next five years considering increasing disposable income among younger population, change in lifestyle and eating habits, payment paths simpler and safer and a hectic and busy work-life culture that influences a lack of interest in home cooking.
The integration of technology and its role in the growth of cloud kitchen:
The advances and integration of technology have brought about fundamental changes in the ordering and consumption of food. Today, cloud kitchens are disrupting the food industry by revolutionizing online food ordering apps. The F&B industry has also welcomed innovative technologies with robotics and artificial intelligence (AI) interface for reduction of prepared/delivered food costs and improved service standards.
Cloud Kitchen, being digital in nature, introduces innovative technologies, for example the implementation of Kitchen Display System (KDS) to improve productivity in the high octave kitchen space. The details of the customer’s food order are mentioned accurately in the KDS, which helps the staff to arrange the dish according to the needs and requirements of the customers. Unlike restaurant servers who mix up orders resulting in food waste and hurting customer service. The integration of AI-based technology in the cloud kitchen helps streamline its operations more smoothly and efficiently. He identifies the right ingredients to use when preparing a dish, helps experiment with menus, manages inventory, and suggests ways to handle customer feedback in a professional manner.
In this changing world, technology, including ground robots and aerial drones, could further help reduce delivery costs. Additionally, automated standardized processes that use machine learning-based prediction tools and robot chefs to prepare personalized quality meals in less time at lightning-fast delivery speed are set to redefine the future of the cloud kitchen industry.
Profitable Business Model – Catering Business vs Cloud Kitchen:
The cost factor involved in starting a cloud kitchen business is relatively very low compared to the brick and mortar business model and setting up a restaurant. A cloud kitchen has a low Capex and its implementation typically requires 1/3rd of the investment needed to start a restaurant business. Cloud kitchen entrepreneurs don’t have to worry about high rental costs, restaurant interiors, and customer facilities like traditional restaurants. However, the bulk of investment in the cloud kitchen business is infused into the technology that drives its operations, well-equipped kitchen infrastructure, workforce training, delivery fleet, and management of the supply chain.
Some of the benefits of running a cloud kitchen over a restaurant include lower rental costs, fast business set-up, scalability with low investment, and increased customer reach with optimized channels. for the delivery. The cloud kitchen model generates value and creates win-win situations for both end consumers by providing them with the convenience and service of ordering food from home and for business owners in the F&B industry by reducing considerably their operational and real estate costs.
Trends driving the popularity of cloud kitchens:
Today, in the race to offer unique services and maintain their individual identity, many cloud kitchens have established themselves as eco-conscious brands. Many cloud kitchens have taken a sustainable and authentic approach that is reflected in their cooking techniques right down to food packaging materials. Food is delivered in authentic earthenware, steel cutlery, reusable glass jars, paper bags and cardboard boxes that encourage customers to help minimize plastic waste and pollution. These initiatives not only help preserve the flavor and nutrition of food, but also promote a sustainable and healthy lifestyle among customers.
In recent times, cloud kitchens are revolutionizing the F&B industry with advanced technology, evolving consumer food consumption trends and operationally sound business model. Automated deliveries, complex machine learning algorithms and a skilled workforce will be key factors in shaping the future of the restaurant industry in India.
The opinions expressed above are those of the author.
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