September 30, 2021

Everything You need to know about Food Delivery Businesses!

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The food and beverage industry today is nothing like it was just a few years ago. As the pandemic, busier lifestyles, and new technology changed our daily lives, the dine-in restaurant industry suffered. In its place came a new wave of food-delivery businesses that pair perfectly with this new way of life. New restaurants or those that pivoted their business model to cater to more delivery orders found waves of success alongside that of food delivery platforms like Deliveroo and Foodpanda. These changes mean that there are new things current and prospective restauranteurs need to know about food delivery businesses!

The numbers back this up: Hong Kong’s food delivery industry was worth a staggering 615 million USD in 2019, but grew rapidly to 782 million in 2020. It’s predicted to continue this growth, hitting over a billion by 2025. 

If you’re planning to start a food delivery business, congratulations – you’ve made the right choice. But competition is fierce in the F&B industry, especially in Hong Kong. Knowing what steps to take and what exactly constitutes a successful food delivery business isn’t easy. This guide will help point you in the right direction and get you started on your new journey. 

But first… what exactly is a delivery-focused restaurant?

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For as long as many of us can remember, restaurants were predominantly dine-in locations. There are, of course, exceptions when it comes to street food stalls, fast food joints, and the likes, but the term “restaurant” was reserved for areas that had seating. What we know about how food businesses were simple: there would be cooks in the kitchen in the back, and front of house staff and managers that run the front-end of the operation. This model worked great, as people frequented these spots and even moderately popular restaurants in Hong Kong would have lines of people queueing up at peak dining hours. But after such an extended period of dining restrictions, many dine-in restaurants struggled to find enough customers. 

What you need to know about food delivery businesses is this: The delivery-focused model cuts down the inefficiency of having empty seating areas. It captures the interest of the many more people who are ordering food delivery and places that as its sole focus. In short, these delivery kitchens (also known as CloudKitchensTM, virtual kitchens, ghost kitchens, and dark kitchens) are restaurants that have no front of house staff, no seating area, and therefore have much more streamlined processes. In fact, the only limit to how many orders you fulfil is how many you receive – and how fast your chefs can cook. 

The steps you need to take to open a delivery-focused restaurant. 

#1 – Know your cuisine

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Just like when opening a traditional restaurant, having quality food is of utmost importance. In this new era of F&B, food delivery is held to the same standards as dine-in locations. 

#2 – Organise the logistics

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There are several different steps you need to take when starting a delivery restaurant, including:

  • Find the ideal location
    • Unlike traditional restaurants, you won’t need to be in the centre of town. Instead, you’ll want to be in an area with cheaper rent but still with access to a huge pool of customers. Typically, this will be near residential areas. 
  • Work out an optimised usage of space
    • Many restaurants have spent years optimising the perfect usage of space in their kitchen. But delivery-focused restaurants won’t have nearly as much washing to do and will need a highly streamlined space to operate efficiently. 
  • Find contractors to renovate your space
    • When moving into a newly rented space, you’ll need to renovate it and make it yours. This is usually a timely and costly process, but it is absolutely essential.
  • Get all the equipment
    • Many restaurant kitchens need highly specialised and industrial-sized equipment to keep things running smoothly. These costs can quickly build up and make the upfront investment for starting a new kitchen significant. 
    • And much more…

Alternatively, you could rent a CloudKitchensTM space. Lots of the time-consuming, troublesome, and extortionate steps above can be completely circumvented by simply moving into a space created solely for food delivery businesses to use. You’ll get: 

  • Easy access to new customers
    • There’s a huge demand for delivery food nowadays. Renting a CloudKitchensTM space from Freshlane means you’ll be operating in areas analysed to be high-demand and near residential areas. s
  • Extreme flexibility
    • Renting a space from a provider like Freshlane gives you ultimate flexibility. Say bye to year-long contracts and hello to short-term, flexible leases that mean you won’t be laden with the burden of renting a location you’ve decided isn’t for your business. 
  • Lower costs
    • With equipment and facilities already in the kitchen space and no front-of-house teams, there’s far less upfront investment and operational costs to worry about.
  • Access to a support team
    • Starting a new restaurant business is never easy, no matter how you do it. Our support team is here to make the process a little easier and prepare your business for success. 

Want to know more about food delivery businesses like the CloudKitchensTM delivery kitchen? Fill out the form below to get in touch with our specialists now!

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