The biggest challenge is when customers ask your prices, and then say ‘we can get it cheaper from the market’. Just because you are not a known brand, people tend to devalue you without realising the effort you are putting in to your products,” shares Prerna Dewani, 23, a marketeer who trained in baking and patisserie in Gurugram and Paris in 2019, before returning to open Le Gourmand, a cloud bakery that specialises in customised desserts and cakes.
While largely conceived prior to the pandemic, the concept of a cloud kitchen has really grown into its own in the Capital during the course of it. With Delhi-NCR eateries having to constantly change or cease dine-in operations to the whims of Covid waves, and ordering in becoming the new norm, established brands and entrants are seeing opportunity in the model, spookily called ‘ghost kitchen’.This means the brands operate only as commercial kitchens that order food directly to consumers through delivery platforms or on the internet, sans any dine-in.
However, Zorawar Kalra, Founder of Massive Restaurants, who opened up cloud kitchen for few of its restaurants and a new Butter delivery brand, breaks down the attraction of such a concept noting, “The rent to revenue ratio of cloud kitchens is significantly better than traditional restaurants. Good units can operate at single digit rent to revenue percentages, thereby ensuring a quicker break even. Also setup costs are lowered, which means ROI is significantly quicker in some cases.”
Attractive margins are what attracted Sameer Chona of Kissa — Zaike Ka, a delivery only service. But a big hurdle for cloud kitchens, he says, are the aggregators that often deliver their food. “They mask customer data and so can enjoy a monopoly on guest feedback and statistics, which is a hindrance for a brand trying to understand the dynamics of its market.”
Gaurav Mehta, Founder of The Trial Box, a cloud kitchen and gourmet delivery brand, says he feels the biggest challenge to cloud kitchens is of “newer players entering the industry on a daily basis without understanding its dynamics.” Agrees Jaydeep Mukherjee, Director, Cloud Kitchens, Impresario Handmade Restaurants, adding, “People who think they can make a quick buck and run a cloud kitchen from home might want to first of all consider logistics. There’s no point making great food if you can’t deliver it fast, fresh, reasonably warm. Either you have the bandwidth to do it yourself or rely on aggregators who are going to eat into your margin,” he points out.
And there are other factors to consider, apart from figuring out your USP from scores of other enterprises making similar if not identical products at cheaper rates. “You have to figure out the right kind of packaging, costs, quantities, since no one is going to make you just 100 containers. There are also branding and marketing considerations: are you doing it all yourself, do you have the budget to get someone else to do it?”
And it’s not just newcomers. After working at some of the best restaurants and clubs in the Capital Chef Harangad Singh, who finally started his own cloud kitchen brand, Parat (that will complete one year next month), says, “We are chefs, not businessmen. Finances come into everything, and so it’s no longer about just cooking food,” he cautions, adding, “As the owner, you never know where problems emerge from, and one wrong move can unravel all your work.”
Chef Mousim Sidana, of Slow BBQ, who also ran the entire gamut of cooking from 5-star hotels to high-end restaurants to niche catering before starting his own venture, notes that a food start-up can be sheer hell for a novice, concluding, “Even if you are good, you need to be prepared to wait for people to recognise that you are providing something great, and be ready to go back to the drawing board if something is not working out. Only good food and great relations with customers will keep you moving forward.”