Shared kitchen is a biggest hit concept globally, but in India no one has actually heard of it or has experimented with it till we were all stuck at home during the covid-19 pandemic. Shared kitchen or co-kitchen as we may call it is generally spread across 1200-1800 Sqft with multiple restaurant brands delivering your orders from same kitchen.
With the hospitality industry hit hard by the pandemic, the industry is facing a nightmare. Even with the government applied unlocks, it is seen that the restaurant industry is still facing losses in sales and capital. With consumer demand for home-delivered meals booming, venturing into the cloud kitchen business struck three friends, Charul Sehra, Inderdeep Singh & Loveneet Singh - the smart thing to do, and thus they launched Outlet Buddy, a co-working or a shared kitchen you may call. Excerpts from the interview:
Working as a partner
The biggest loss for any business is for it not being able to operate. During lockdown- many restaurants were closed and moreover people stopped ordering from outside. We help restaurants by becoming their backend partner, from whom you can order your entire dishes- 60-90% done. Hence, the Merchant (restaurant owner) does not need expensive equipment, at his end. Furthermore, reducing the need for expensive human resources, and unnecessary storage. Also, our models help restaurants maintain their Cash flows better by ordering the required amount of Inventory only according to their sales analytics/forecast.
Also Read: How Cloud Kitchen is changing the Dine-In Scenario in India
How does it work?
We imagine Outlet Buddy as a "Buddy" who does all the kitchen mise-en-place for the restaurant- before he/she enters the kitchen and does the final plating for the guest. We call our relationship with our merchants as an "Infinity Circle" and we hope to work hard to stay a part of that circle. Outlet Buddy is your online kitchen- which works according to your business- all you have to do is get on board by choosing out the following three options :-
- Getting the Dishes from us
- Sharing our existing Cloud kitchen
- FOCO (Franchise owned Company operated) model
It can do the following for you:
● Reduce Cost ( Real estate cost, Human Resource Cost, Equipment Cost and Holding Cost)
● Scale on Demand ( minimalistic cloud kitchen set-up)
● Saves Time ( One Stop Ordering for all Inventory, 24hrs Delivery, Shorter BEP Cycle)
● Bespoke Dishes
● Shared Cloud Kitchen Offering
Shared cloud kitchen is already a major hit in the global market. What is your view on its response in India?
Shared cloud kitchen as a concept has taken flight from sometime in the global market, cloud kitchen in itself came around to reduce running operational costs for the kitchen, and also a parallel revenue arm for any restaurant- but the concept of cloud kitchen, with state of the art-best practice solution for cooking being used in the commissary and Order taking and last mile delivery technologies running in the cloud kitchen- is a tough concept to master with very high operating cost, customer acquisition cost and delivery cost. The same concept when put under the shared cloud kitchen scenario reduces all of the above cost and thus helps any merchant reduce the BEP (Break even Point) cycle.
Who are some of your restaurant partners? What is the profit sharing model?
Some of the brands we work with are SuperNaan, Pay per bowl, Khalnayak Biryani and ADDA126, in Noida. All brand owners/merchants pay a monthly fee to us for running their brand and also economical % on all sales.
May Interest: Kolkata-based Chowman enters Bengaluru, opens first cloud kitchen
Franchising for growth
We work on a revenue sharing model under the FOCO model in which we enable restaurant owners to own the franchise of our home grown brands, so for that location we not only run their brand, we also give them a pool of brands to choose from, as a franchise-out of our home grown brands. During this pandemic, a full-fledged kitchen is a liability for any restaurant owner; this liability can quickly turn into an asset, as the Outlet buddy team will take over the kitchen, and start running a cloud kitchen from that location. The % of revenue promised to the restaurant owner is evaluated depending upon the location and the size of the Restaurant/cloud kitchen.
Focusing on innovation
Outlet buddy is tying up with best in Industry AI and IOT solution providers, we feel that after the consistent ability of producing good food, the most important factor that will separate the front runners would be their ability to deploy technologies in the cloud kitchens & Restaurant. We are seeing restaurants gradually shifting from mammoth Aggregators to Self owned websites, Whatsapp and Facebook ordering. For Packaging- we are only using Reusable and Biodegradable material, notified by Food Safety and Security Authority India.
What’s your plan going forward?
We believe the most important aspect of our business is consistent good quality food. With cloud kitchens coming to the fore-front, the next 2-3 years would see a massive inflow of new and innovative technologies that would define new ways of customer acquisition. Outlet buddy aims to be an Online kitchen to small and big restaurants both, hence we plan to invest in two pronged strategy that would include -investing more in best practices equipment in both commissaries and cloud kitchen and also investing in AI for ordering and IOT for logistics & Inventory management.