It is true that there is change in conventional restaurant business. Lots of smaller restaurants, concept-based places, hyper-local restaurants and dark kitchens are developing. If you look at restaurant industry pre 2014, it was mostly focused on dine-in and delivery was just an add-on. If customers call up directly restaurants used to deliver. And, delivery was unorganized and it was only through phone ordering.
Swiggy Access is the largest Dark Kitchens Network in India with presence in 18+cities and is expanding to 100 kitchens every month. Joseph Cherian, COO, Swiggy Acess talks about Dark Kitchen Businesses in India.
Delivery Business pre-2014 Era
Unreliable delivery: there was unreliable delivery before 2014. It was unsure that whether the same food would come or not after customer ordered the same. Whether it will be on time and also there was no guarantee if some orders were missing.
High Minimum Order: Because the restaurants were not focused on delivery. There was no system or processes involved on how I run efficient deliveries. So, the cost of delivery was much higher. Restaurants used to ask for a minimum size of Rs 1000 to place an order.
Poor restaurant selection: Earlier, you had certain traditional areas where restaurants where placed. And, it was not concentrated towards the larger consumer. So, there were very few restaurant selections.
Delivery Business Post 2014 Era
In the last few years we have seen a tectonic shift in the food being delivered. Today, around 10-15 meals are consumed outside home of which around 50-60 percent is deliveries but we see in the next 10-15 years 40-50 meals would get consumed out of home out of which 75-80 percent would be delivery itself.
Delivery is no more a retro fitted business: I have a dine-in and let me allow few deliveries; it’s not the case now. There is a continuous effort from restaurant partners as well to focus on delivery. Around, 67% restaurant owners want to open dark kitchen as their next outlet.
Saving on real-estate: In restaurant business your location plays an important role. The visibility has to be high. You want a corner location; your signage needs to be at least 20 feets. But for dark kitchens you do not have to worry about locations. You can open at any floors. Also, you do not need to be at commercial spaces.
Saving on People: Since, you don’t have people on the front-end of the business you need less people. And, since you are only cooking and the focus is on it so it improves the quality of food which comes out of the kitchen.
New synergies: We could also do multiple cuisines from the same location and with multiple orders coming from the same area the throughput increases.
Additional Benefits: Since you are working with multiple partners, the knowledge of your data increases automatically about how do you run better deliveries? Data is the key.
Thus, we can say that food delivery has changed the whole dimension of eating out trend.