What's A Virtual Brand?
A virtual restaurant is a restaurant that doesn't offer dine-in service.
They rely on apps and integrations to deliver meals straight to the customer's doorsteps. Ghost kitchen startups can rent meal preparation facilities or invest in a food truck with preparation and packaging equipment.
One common type of virtual brand is where a brick-and-mortar restaurant uses its existing space and equipment to spin up one or more virtual brands. Perhaps they have a virtual burger brand called “Bill’s Burgers” and a virtual chicken wing brand called “Wendy’s Wings”. These brands would only exist online and in delivery apps, but the food would be prepared in the brick-and-mortar location.
But you don’t need an existing restaurant to capitalize on the advantages of starting a virtual brand.
The Advantages of a Virtual Dining Concepts
1. Low Startup and Operation Cost
The virtual dining concept eliminates dine-in space areas from the business model, one of the core elements of traditional restaurants. It's a profitable business idea if you're looking to start a restaurant business.
With no need for a walk-in facility, there's no need for forefront personnel. Labor and maintenance costs are also remarkably reduced when no guests are coming to the facility. You might need to invest in a ghost kitchen food truck, packaging and digital marketing. However, launching ghost kitchen companies require fewer infrastructures than brick-and-mortar restaurants.
2. Shifting Customer Behavior
More and more people are ordering takeout than ever before. The rise in food delivery has led experts to predict that the global food industry will reach about $200 billion by 2025. While some restaurants choose to supply their own delivery staff, most turn to the services of third-party delivery applications.
3. Concept Experimentation
The traditional restaurant model isn't easy to pivot and there's little room to experiment. It takes several years to adopt new concepts once a facility is set up. For a ghost kitchen, ideas and menus can be tested on different platforms to gauge reception. There's more room for trial and error until the brand finds a perfect fit for their customers.
Another way to take advantage of restaurant analytics is by creating multiple menus, which lets you cater to different types of customers. For instance, if you notice that two specific dishes are extremely popular with your customers, you may choose to place those dishes on a separate, more expensive menu. Alternatively, you can use multiple menus to push your creative boundaries (such as by offering different cuisines on each menu). Some owners even have several virtual brands that they operate from a single location.
Is a Virtual Brand the Same as a Ghost Kitchen?
While ghost kitchens and brands share many commonalities, they are actually different.
Let's take a closer look at the two.
Virtual Brand
A virtual brand is a food or beverage business that utilizes a ghost kitchen to prepare its offerings. These goods are then delivered to customers, who never step into a dining room or traditional brick-and-mortar building.
While some virtual brands operate out of existing restaurants, others operate out of ghost kitchens.
Ghost Kitchen
The concept of using a ghost kitchen is not new, but they currently allow aspiring chefs to share their food with a wider audience at a fraction of the cost.
However, the ability to reach customers and deliver one-of-a-kind experiences has never been easier. Although restaurants can replace their revenue by having only delivery service, it helps alleviate some costs. Also, because of additional space in the restaurant, more meals can be prepared, allowing restaurants to take on more orders.
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