The restaurant industry is seeing a major wave of innovation right now. Many existing restaurant owners are abandoning the conventional service model for several new models—like food trucks, “groceraunts,” and delivery-only restaurants.
Much of this change is likely in response to shifting demand generated by the coronavirus pandemic, which forced restaurant owners to adapt rapidly to stay afloat.
Now, as the pandemic winds down and consumers return to in-restaurant dining, the restaurant industry as a whole is learning which alternative service options are most likely to offer a competitive edge still.
Dark Kitchens and Delivery-Only Restaurants
Many of the listings on food delivery apps, like Uber Eats and GrubHub, are for restaurants that don’t really exist—at least, not for customers interested in the sit-down restaurant experience. The restaurant may instead be the product of a kitchen dedicated to cooking food exclusively for delivery orders.
Dark kitchens—also called ghost kitchens, cloud kitchens, and delivery-only restaurants—are restaurants without tables or wait staff. These restaurants make their money by contracting out kitchen services to other restaurants or by exclusively serving customers who order online or over the phone.
Dark kitchens existed before the pandemic began, but as demand for delivery took off, so did their popularity. According to one report, COVID-19 accelerated the delivery-only segment’s growth by five years in three months.
For businesses, the benefits of the delivery-only model are primarily in reducing startup and maintenance costs. If you only provide delivery, you don’t have to maintain front-of-house or hire waitstaff. Because many delivery-only restaurants provide delivery services through gig economy-style apps, you may not even have to hire delivery drivers.
The loss for business owners is that they can no longer offer in-person dining services. If they are renting a pre-existing kitchen, the owner may also have less control over kitchen layout, inventory, equipment, and staff.
Many new ghost kitchens, for example, advertise themselves as “smart kitchens” outfitted with a range of Internet of Things-powered restaurant technology. Aspiring dark kitchen chefs that don’t need this advanced equipment may pay for assets they don’t need or be forced to look elsewhere for kitchen space.
Food trucks have rapidly become a popular and highly mobile alternative to the traditional restaurant model. With this approach, owners convert a box truck into a mobile catering vehicle complete with its own kitchen.
What food trucks lose in dining space, they gain in flexibility. A food truck can pick up and move its kitchen at any time, allowing it to serve events and provide service at food truck parks or similar open-air venues on short notice.
This flexibility is likely part of why the food truck market outgrew the broader restaurant industry between 2016 and 2021 by a margin of around 7.5 to 1.1 percent.
There are significant limitations to the food truck format, however—which possibly is why many foodservice industry publications write to food truck owners as if they plan to eventually rent restaurant space and adopt a more conventional service model.
Kitchen space is extremely limited, restricting both the menu and the number of customers you can serve at a given time. Food truck failure — like a flat tire or damage to the truck radiator—can also prevent you from serving any customers at all.
Like dark kitchens, you also lose out on the advantages of having space for customers to sit down and be served.
Also, while food trucks tend to require less money for initial startup costs, they can sometimes pay more than conventional restaurants for permitting. In some cases, the cost difference is enough to make the two models comparably expensive.
“Groceraunts” and the Hybrid Service Model
Some restaurant owners are opting to combine existing service models—providing grocery services or a cafe, for example—in addition to standard offerings.
The reasons for adopting this model can vary from business to business. Some adopt the hybrid model as a way to provide additional services to their community. For an example, see the Philadelphia-based Honeysuckle Project, which aims to provide a hybrid grocery store, community center, and restaurant for residents of the neighborhood of Mantua, a food desert where more conventional grocery stores may be difficult to reach.
Others, like existing supermarkets, adopt the model because they want to draw in additional customers with restaurant services. With these groceraunts, shoppers can complete their weekly grocery trip and pick up dinner at the same time.
How Alternative Foodservice Formats are Disrupting Restaurants
Changing consumer expectations and preferences are likely to have a major impact on the restaurant industry, even as the coronavirus pandemic winds down.
Delivery and contactless models are on track to remain much more popular than they were pre-pandemic, potentially opening up new opportunities for dark kitchens, food trucks, and similar service options. Community-based restaurants may also become more important.
Customers increasingly want to spend money in a way that supports their local community, meaning groceraunts and hybrid models that serve as community hubs or community spaces may draw more attention than similar restaurants that take a more conventional approach.
Emily Newton is the Editor-in-Chief of Revolutionized Magazine. She has over three years experience writing for the food and beverage industry.