Cloud Kitchen Inside story

Part 1 of 2

Build 1000 Restaurants in 24 months

Content

1. By Component (Platform, Services),

2. By Solutions (Order Management, Inventory Management, Customer Experience Management,
and Reporting), Deployment Type,
3. By End User,
4. By Region, Forecasts to 2026
Market Summary
The global Cloud Kitchen market was valued at USD 0.65 Billion in 2018
and is expected to reach USD 2.63 Billion by the year 2026, at a CAGR of 17.2%.

The cloud kitchen market highlights the revenue generated by the vendors in the market
by offering solutions for managing a cloud kitchen and all the activities associated with or
dering, inventory, supply chain, food delivery, customer satisfaction, customer experience
, digital payments, and others.

It is a virtual restaurant that does not exist as a physical entity. It is heavily dependent on
third-party integrations, home delivery applications, orders placed via a website, web port
al or on a call.

Rising adoption of online food delivery platforms, the ability to eliminate the need for
physical infrastructure and equipment for setting up a restaurant, increasing the standard
of living and urbanization, and the low-cost implementation of these platforms are the
primary growth factors driving the cloud kitchen market
Salient Trends of the
Cloud Kitchen Market
1) The Asia Pacific has a huge potential in the market due to rapid urbanization and global digitization, and
the increasing standard of living of the people is expected to supplement the growth of cloud kitchen market

2) Asia Pacific region has become a focal point of attraction for many multinational companies previously
concentrated in the North America and Europe region, trying to expand their business.

3) North America is expected to significant revenue-generating a region of the market as the presence of well
-established solution providers as well as the high density of key players in this region

4) The web deployment model offers low-cost installations due to the elimination of infrastructure cost
along with benefits such as scalability, reliability, availability, and security

5) The platform segment of the cloud kitchen market is estimated to dominate the market in 2020 due
to the increased demand for integrated solutions in the restaurants for order management,
inventory management, and customer experience management
Salient Trends of the
Cloud Kitchen Market contd.
6) Extensive research and innovation are also expected to grow the market as the market is highly
fragmented in nature, and companies are investing heavily in such activities to continually roll out
innovative products to capture the majority of the market.

7)The customer experience management segment of the market is forecasted to have the fastest growth
rate due to the increasing need for customer retention, customer satisfaction, and new customer
engagement.

8) The web deployment is estimated to dominate the cloud kitchen market during the forecasted period
. The mobile deployment is a refined version on the web application and lags functionalities of the web
deployment model

9) In August 2019, DoorDash acquired caviar, an online food delivery platform. Caviar’s premium
customers will be working with DoorDash to drive the organizational growth

10) In October 2018, Foodpanda, the online food ordering and delivery company acquired Holachef
Hospitality, a food-tech startup based out in Mumbai. This acquisition empowers Foodpanda to enter
the cloud kitchen market and launch their own range of products in different categories and cuisines.
Companies considered and profiled
in this market study
1. Toast, Inc.,
2. Square, Inc.,
3. Xenial, Inc.,
4. Ambiosys Labs Pvt Ltd.,
5. ORDERLORD ,
6. LogBase Technologies LLP,
7. POSist Technologies Pvt. Ltd.,
8. Bringg Delivery Technologies Ltd.,
9. PAR Technology Corp., and
10. Lightspeed HQ.
Toast, Inc.
is a cloud-based restaurant software company based in
Boston, Massachusetts. The company provides a resta
urant management and point of sale system built on the
Android operating system. Toast was founded in Cambr
idge, Massachusetts in 2012 by Steve Fredette, Aman
Narang, and Jonathan Grimm. Wikipedia
Headquarters: Boston, Massachusetts, United States
Founder: Aman Narang
Founded: 2012
Number of employees: 2,000 (2019)
Area served: United States
Subsidiary: OAE Software, LLC

https://pos.toasttab.com/about
Square, Inc.
is a financial services, merchant services aggregator, and
mobile payment company based in San Francisco, California.
The company markets several software and hardware payments
products and has expanded into small business
services. Wikipedia
Stock price: SQ (NYSE) US$85.70 +0.46 (+0.54%)
20 Feb, 4:04 pm GMT-5 - Disclaimer
CEO: Jack Dorsey (2009–)
Revenue: 330 crores USD (2018)
Subsidiaries: Weebly, Eloquent Labs Inc., Square AU Pty Ltd, Or
derAhead, Dessa, Square Capital, LLC
Founders: Jack Dorsey, Jim McKelvey

https://squareup.com/us/en/about
Xenial – https://www.xenial.com/

Cloud Based Restaurant Management Platform, leverage your

professional network, and get hired. ... Global Payments Inc.

Ambiosys Labs Pvt Ltd - www.ambiosys.com

Service Provider of Web Development Service, Social Media

Marketing, Business E-mails Service, Web Hosting Services
and Web ...
Orderlord https://orderlord.com/

reinvents food delivery management. We help you to manage

orders, drivers and delivery like never before. ... food delivery
dispatching, software, scheduling, reports, mobile application,
GPS tracking, food delivery management, automatic routing.
Market-O-Nomics
1) Asia-Pacific regional segment of the Cloud Kitchen market is
expected to remain a growing segment during 2019-2026,
at a CAGR of 20.0% owing it to the huge potential in the untapped
markets like China, Japan, and India where the food delivery and
food industry are growing rapidly.

2) North America is expected to capture almost 50% of the

cloud kitchen market in 2020 due to the presence of a
well-established telecom and It industry as well as the extensive
focus of the restaurants to increase their business by implementing new and
advanced technological models
Market-O-Nomics contd.
3) As of 2019, the services segment is projected to have the fastest growth
rate of 22.5% of the global cloud kitchen market due to the increasing
need of implementation services to integrate the platform with existing
systems and business models

4) Order management is estimated to hold the largest market share during

the forecast period in the cloud kitchen market as it deals with the
different order related processes such as order placing, order processing, order assig
ning, order acceptance, order tracking, and order fulfillment.

5) The mobile segment is expected to register the highest CAGR of 23.7% owing to t
he increasing number of digital mobile payments and the increased number of smart
phones globally
Market Size

With improvements in technology, changes in lifestyle preferences,

and upgrades of the value chain, cloud kitchens are set to take off.
In the report “Is the Kitchen Dead?” UBS estimates that the online food delivery
market will grow ten times in the next ten years,
from $35 billion currently to $365 billion by 2030.
UBS mentions that “In a world of increasingly time-starved and asset-light consumers,
online food delivery is part of a mega-trend, combining the on-demand and sharing
economies.” UBS predicts that there could be a scenario that most meals currently
cooked at home are instead ordered online and delivered from either restaurants
or central kitchens.
Food Delivery Scenarios
As per Morgan
Stanley,
40% of total
restaurant sales
—$220 billion—
could be up for
grabs for
delivery by 2020
, compared with
current sales of
around
$30 billion.
Online food
delivery could
grow by a 16%
annually
compounded
rate over the
next 5 years.
Aggregator Apps
The most important role in the advent of cloud kitchens has been played by
food aggregators. With services like
UberEats,
DoorDash,
PostMates,
Deliveroo,
Eat24,
Amazon Restaurants,
Zomato,
Swiggy,
etc., food has become available through just a few clicks.
These services charge between 15% and 35% to restaurants as commission.
Ideally, restaurants don’t mind the commission due to the order volumes
generated by these services.
SWOT Analysis
(Strength, Weakness, Opportunity, and Threats)
a) Strength-
USP of your restaurant, competitive pricing, location, quick service, etc.

b) Weakness-
an unestablished brand identity or untrained staff.

c) Opportunity-
as a new concept in the area, you can have a First Mover Advantage.
A viable opportunity can be anything like the increase in demand for
Healthy food etc.

d) Threats-
These can range from anything; from a new restaurant competition to a sudden shortage
of supplies.
The best way to deal with threats to your restaurant business is to prepare how you will
tackle them in advance and include it in your restaurant business plan.
Types of Cloud Kitchens
Hub and Spoke Model – In the hub and spoke model, a central kitchen prepares the food, and then s
emi-cooked dishes are shipped to final smaller outlets where they need to be cooked before shipping.
It results in cost-savings due to scale and standardization.
Pod Kitchen – These are small containers that can be placed in any location, such as parking lots. Due
to their size and mobile nature, they are easy to set up and operate. They have had their own share of
controversies as mentioned earlier.
Commissary (Aggregator) Kitchens - These are the kitchens that are owned by a 3rd party. Many rest
aurants will use them on a shared basis, from kitchen space to fridge space. Travis Kalanick has investe
d in City Storage Systems, which transforms old warehouses into kitchens. A comparison can be drawn
with shared working spaces where different companies share the same utilities and rent out office spac
e from a service provider. These kitchens can be fully stacked or just having a shell kitchen. These are a
lso termed kitchen as a service (KaaS).
Outsourced Model – As the name suggests, here all the operations, food preparation and customer-fa
cing operations are outsourced. The chef just provides the final touch before sending out the product f
or delivery. This is not a popular model.
Independent Kitchen – Standalone kitchens with no offline presence. They can deliver the product the
mselves, through a food aggregator, or through both.
Brief History and Market Size
of Cloud Kitchen
Cloud kitchens are not a new concept: pizza delivery restaurants have been around
for decades, and, specifically, pizza prepared for take-out came to be in the 1950s.
The current concept of the cloud kitchen initially emerged in India. In 2003,

Rebel Foods, backed by Sequoia, started its first business, Faasos,

which sells Kebabs. Today, Rebel Foods has over 9 brands and recently raised $125
million and is valued at $525 million.
Shared Kitchens
serve those that serve others

Advantages of delivery-only
Launch new locations and grow your business with less investment and more upside.

USA
Smart kitchen
https://www.cloudkitchens.com/
Kitchen united
https://www.kitchenunited.com/restaurants/

INDIA
LOYAL HOSPITALITY PVT LTD
https://kitchens-at.com/kitchens-at/
 Build 1000 Restaurants in 24 months
— AND 10000 OF THEM IN 5 YEARS
a) Build multiple restaurant brands riding on the same kitchen network and

b) Becoming channel agnostic or omni-channel, so that customers can enjoy

offerings regardless of the distribution partner

The concept of “one cloud kitchen=Multiple restaurants” may sound an obvious one,
but it’s essentially the tip of the proverbial iceberg.

Build five strong competencies / pillars, as described below, to execute on this idea

1. Culinary Innovation Center

2. End-to-end Tech Platform
3. Pan Nation Supply Chain
4. Brand/Product Launch Playbook
5. Cloud Kitchen Network
 AMITAVA ROY +918971835064(M), calluproy@gmail.com
Brief Profile
a multidimensional hospitality professional
with international exposure in some of the well known MNCs since 1999