2020 has been a watershed year for the F&B industry. The pandemic ravaged the industry at first – but all necessity drives innovation.
Cloud kitchens were once a niche solution for certain F&B brands. Especially in these past couple of years, though, they have found their foot in the industry and cemented themselves as a stable option for restaurateurs looking to modernise their existing brand, or start a new one. But what’s involved with actually getting a cloud kitchen location up and running? How do you choose where to open one, and what else do you need to be aware of?
As a cloud kitchen operator, we’re well versed with what it takes to find success in your new cloud kitchen. Here’s our ultimate guide to give you a kick-start in this new and exciting kitchen model.
Why cloud kitchens?
Cloud kitchens have been a rising trend in the F&B industry these past few years. They work perfectly with third-party delivery platforms and have shown themselves to be a more effective and cost-efficient way of running and growing a restaurant business. With more and more people using food delivery services, shifting consumer habits has driven this change – while the pandemic has done nothing but expedite it.
For business owners, cloud kitchens provide a way to modernise and streamline their business processes. By removing the bottlenecks of a traditional brick-and-mortar restaurant, lowering the associated costs, and removing the time-consuming aspects of running a business such as insurance and renovations work, cloud kitchens offer a pathway to success for restaurateurs.
Think about the location
If you’ve decided you’re going to open a cloud kitchen, the first thing you need to do is find a suitable location. Just like with dine-in restaurant locations, the area of your cloud kitchen can dictate whether it’s a huge success or fizzles away into closure. Different locations will have different rent prices, a different customer base, a lack of a certain type of cuisine, and more. Next, you should consider how much space you need. Whether you want a cloud kitchen space for a single brand or to run several, you may want to consider spreading your operations across multiple locations in Singapore.
As an operator, Smart City Kitchens has done the hard work of analysing delivery order volume data and more before selecting the most promising locations. Currently, we have cloud kitchens in 6 different locations across Singapore, including Tampines, Clementi, and more.
Organise the admin / legal / onboarding work
The next step in opening a cloud kitchen is to organise all the paperwork. While there’s significantly less to do in comparison to a traditional restaurant, there’s still some admin work to get sorted before you’re up and running.
Firstly, you’ll need to work out exactly what type of equipment you need to run your kitchen how you like it. We’ll help provide equipment like sinks, dry, cold & frozen storage, ventilation, and more, as well as infrastructure and services like air conditioning, wifi, security, cleaning, and more. Any other specialised equipment you can easily move in and get set up.
On top of this, you may want to change the layout or size of your kitchen space. Smart City Kitchens offers kitchens running from 100 sq ft to 230 sq ft, and we’re more than happy to accommodate layouts and specifications that you need to run your kitchen at optimal efficiency.
Next, you’ll want to make sure you have all your staff, licenses, and suppliers in line. Working in a cloud kitchen means you can operate with a much smaller, consolidated team – but you will still need to organise suppliers, insurance, licenses, and more. One of the benefits of working with a cloud kitchen supplier like Smart City Kitchens is that we can help with many of these processes. We organise insurance for all our kitchen tenants, as well as licenses. Our team will help make the transition a more hands-off process so you can focus on doing what you do best: cook great food.
Get the food and menu right
With everything else that needs to be done, it can be easy to forget that the first and foremost part of your restaurant is the food. You’ll need to arrange a network of suppliers to get everything you need at an affordable price, while you can also consider customising different locations (independently if you have more than one) according to variables such as whether it is a high or low income zone, whether there are similar restaurants nearby, and more. Depending on these factors, you can price your food appropriately and make a bigger margin for your business.
In addition to this, packaging is a vital part of running a good food delivery business. If served as it would be in a dine-in restaurant, many dishes would arrive soggy or spoiled. Noodle dishes, for example, can be separated from the soup broth to maintain the best flavour and texture possible, while plastic packaging can make food soggy because of condensation – and is also bad for the environment.
Lastly, you’ll want to sign up for all the third-party delivery companies you plan on partnering with. These are central to your food delivery business and will help you get your food from your kitchen to your customers. Popular options in Singapore include GrabFood, Foodpanda, Deliveroo, and a new player – AirAsia.
Use technology to your advantage
Modern-day kitchens are constantly being improved to become more streamlined and efficient. Cloud kitchens organised by Smart City Kitchens include a tablet at the centre through which everything runs. All orders are managed centrally with it, allowing you to keep track of orders from all the delivery platforms you use in one consolidated place. You’ll also be able to get data and insights into the performance of your restaurant and optimise it accordingly. This could mean showing you which dishes have the highest profit margin, which ones are the most popular, where your kitchen bottlenecks are, and much more.
Market your restaurant
Marketing your restaurant is an essential part of running a successful food delivery business. After all, without enough customers, there’s little point in spending so much time optimising and streamlining your processes.
Since a cloud kitchen has no physical presence for its customers, you’ll need to dip your toes into digital marketing. Social media, websites, online advertising – all of these can help bring you more customers and significantly boost your revenue. At Smart City Kitchens, we provide growth marketing consultation to help brands gain more visibility, especially when they’re newer players on the scene and are still finding their feet in the industry.
Get in touch
If you would like to learn more about opening a cloud kitchen with Smart City Kitchens, get in touch with us today. We’re happy to craft you a detailed quotation or give you a kitchen tour of our spaces.