CloudKitchen® delivery kitchens are not a new concept by any means, and their popularity in the F&B industry continues to grow all around the world, including in Singapore. Providing a cheaper alternative to traditional brick-and-mortar restaurants, they offer an entry into the sector for new businesses or those that have already established their reputation and want to branch out to new markets.
Many people don’t realise that there are different types of CloudKitchen® delivery kitchens they can choose from and might also be unaware of which one is best suited for their business. In order to provide a helping hand, we at Smart City Kitchens have prepared an intuitive guide on identifying the right one that is tailored to fit your needs and requirements.
Cloud kitchens – what are they?
While you may have heard of CloudKitchen® delivery kitchens, you may not be familiar with what they actually are. Simply put, they are small kitchen spaces in a commercial facility that allows businesses to focus mainly on fulfilling delivery orders. Some do offer takeaway services, but this is rare. These facilities are usually situated in the city centre or busy neighbourhoods with plenty of office workers and residents so there is already an established customer base. All types of CloudKitchen® delivery kitchens also require less staff to operate in comparison to normal restaurants, meaning business owners can save significant amounts of money when it comes to staff costs.
What are the benefits of cloud kitchens?
CloudKitchen® delivery kitchens provide a multitude of benefits to businesses that work out of them, such as:
- Minimal overhead costs – Since these kitchen spaces don’t have a dining area like a normal restaurant would, there is no need to have waiters, bartenders, general managers, etc. Instead, all you need are a couple of chefs to prepare the food for the takeaway orders that come in and that’s it!
- Cheaper priced food – Given the fact that the rent of CloudKitchen® delivery kitchens is much lower than actual eateries, they don’t have to charge exorbitant prices for their dishes. This will make them more competitive to a wider audience as they are more affordable.
- Latest tech – Since restaurants operating out of CloudKitchen® delivery kitchens rely on online orders, they use the latest technology to ensure everything is streamlined. Smart City Kitchen provides all businesses at our facilities with cutting-edge software that enables them to view all orders coming in on one tablet, even if they are partnered with multiple food delivery companies. Furthermore, when orders are placed, you can easily discover which items are hitting the spot with your customers and which dishes are not generating enough revenue. Through this, you can implement the necessary changes needed to ensure your restaurant maximises profit.
- Busy locations – CloudKitchen® delivery kitchen providers like Smart City Kitchens are situated in thriving areas with plenty of foot traffic, businesses and residential neighbourhoods nearby, so that businesses can hit the ground running. Currently, we have 9 locations throughout Singapore.
- Online focused – Since everything CloudKitchen® delivery kitchens do is online, there is no need for businesses to create paper menus that are given to customers at traditional restaurants. Instead, their entire menu is uploaded to various food delivery apps like Deliveroo, Foodpanda and GrabFood. With Singapore’s food delivery penetration rate standing at 47.2% in 2022 and expected to rise to 59.5% by 2025, there is a good reason why being online focused is a good thing. With more customers ordering food online, it means more money for businesses whose operating model revolves around deliveries.
The various types of cloud kitchens
1. Commercial kitchens
Primarily for eateries and caterers who need roomy industrial kitchens to fill sizable orders. They are popular because there is no set time frame in the contract, so you can rent it on a day to day basis and avoid other types of kitchen spaces with a minimum contract period. Furthermore, you don’t need to share resources with other businesses, meaning you have a separate space all to yourself where you can prepare whatever is required to satisfy your customers.
2. Commissary kitchens
The ideal choice for F&B companies that have to prepare food and deliver it to various locations. For instance, if you run a Hainan chicken rice food truck in Singapore, this kitchen would be perfect for you. Depending on when you need them and how many orders need to be fulfilled, you can rent commissary kitchens for a short period of time (e.g. how many months you need it), on an ad hoc basis. On top of this, you will have all the basic equipment needed to get cooking right away, which is great for businesses with busy schedules and plenty of customer orders to fulfil. Plus, the costs associated with it are a whole lot less than opening your own kitchen. With all these advantages, you can see why it’s a popular choice among food businesses given that there is no obligation to rent the space on a full-time basis.
3. Incubator kitchens
These are essentially transient pop-up kitchens that are situated in a food truck, or as a kiosk next to a physical restaurant. Instead of serving dine-in customers and delivery customers from one kitchen, which can create a lot of confusion and delays, incubator kitchens give restaurants the ability to divide and conquer. Delivery orders can be prepared from the incubator kitchens, while orders for the restaurant customers can be prepared by the kitchen situated in the eatery itself. It gets rid of the confusion, ensuring that restaurants can serve up excellent food and avoid making careless mistakes that will ruin customer satisfaction and possibly impact the eatery’s reputation in an adverse way.
Since incubator kitchens are typically shared areas as well, you have the ability to choose the time of day that works best for your business. You can also get inventive and test out various food concepts in addition to trying to maximise profits on the ones that prove to be popular with your customers.
4. Kitchen pods
They more often than not come in the shape of a shipping container, but don’t let that put you off. These spaces can be utilised productively to fulfil delivery orders and don’t require a part of hardware and staff, meaning eateries can save plenty of costs on those two fronts. They can also be transported, which is always a plus as it saves you the time of having to find another kitchen unit to work out of. Since these units can get dark quickly as there usually are no windows, you should invest in some lighting and ventilation.
5. Smart City Kitchen’s Cloud kitchens
Usually consisting of multiple kitchen spaces within a large commercial facility, CloudKitchen® delivery kitchens generally only cater to delivery orders. Since there is no dine-in area or additional staff needed other than chefs to make the food, CloudKitchen® delivery kitchens have become an increasingly adopted business model as they are cost-effective and provide all the foundations F&B companies need to get started almost immediately. Businesses that run from facilities operated by Smart City Kitchens also get access to the latest technology and useful analytics that can be used to make strategic business decisions that boost profit. Legal permits and customer success assistance is also provided, meaning restaurants get all-round benefits.
While all the above types of CloudKitchen® delivery kitchens have their own merits, it is ultimately up to you to decide which one will benefit your business to the max. Don’t rush this decision, take the time needed to assess it from all angles before committing to the kitchen space that’s right for you.
Interested in launching a CloudKitchen® delivery kitchen in Singapore? Complete the form or talk to one of our helpful experts today.