Ghost kitchens offer an opportunity for c-stores to expand foodservice sales potential in the digital age.
By Carl Orsbourn | November 4, 2021
Many people didn’t know what a ghost kitchen was before the pandemic, but now it seems the word is everywhere. COVID-19 afflicted the restaurant industry in such a limiting way in 2020, that every restaurant was a ghost kitchen for a period. Ghost kitchens are kitchens that are optimized to fulfill restaurant orders that will be consumed off-premise. They are called “ghost” kitchens because there is no front-of-house, no order point, no signage and no place to consume the food.
In a sense, ghost kitchens are like c-store kitchens. With many c-store kitchens, 100% of the food is consumed off-premise: In a customer’s car or at the customer’s destination. The difference with ghost kitchens is that customers order digitally away from the store rather than transacting directly at the store. So, if c-stores are already doing ghost kitchens of a sort, what is left to say?
To answer that question, let’s explore why ghost kitchens make sense and how they could be used by c-store operators.
Expand Customer Reach
The “I want what I want when I want it” mindset means when guests are hungry, they want that hunger addressed quickly and with the least effort wherever they are. Many c-stores rely on being in the right place at the right time to satisfy the customer’s desire in those moments — and many are driven by impulse.
But this requires the customer to come to the c-store location. The volume of customers hungry within a five mile or 15-minute radius is far greater than those that happen to be perusing a store location. Ghost kitchens expand reach to these customers, wherever they are, and don’t require significant capital outlay — just a great broadband connection and an understanding of digital branding and marketing.
Virtual Brand Sales Potential
C-stores have delighted customers over the years because of the variety they offer. Similarly, virtual brands enable a restaurant to layer brands on top of current kitchen throughput or through ghost kitchens located in optimal spots for delivery speed.
Restaurants now realize that they can cook for a brand that isn’t on the front door because the front door is now a smartphone screen. Brands like Wow Bao, which has over 300 virtual kitchens, need just four square feet of space to provide a completely different food brand, with minimal waste or operational complexities (read: no hood requirements). Some locations have seen incremental sales in the thousands of dollars each week for those embracing such a strategy.
These virtual brands are replacing one of the key value pillars of c-stores — variety — but in a way that may be more convenient, i.e. having the food brought to the consumer. Luckily, many c-stores are already serving a wide variety of menu items — all they have to do is add digital access and delivery fulfillment to compete.
Location, Location, Location
The best c-stores share one consistent component: a great location. Many will benefit from accessible ingress, egress and parking. Getting in and out of a restaurant is one of the biggest challenges for delivery drivers, but c-stores and purpose-built ghost kitchens address this. Better locations get customers the food they desire faster. Faster delivery equals greater loyalty and retention.
Ghost kitchens aren’t that scary, and with the right mindset, c-store operators can grow food sales to greater heights. With the increasing expectation of customers to have food brought to them when they want it, c-stores must respond, and the answer may already be lying behind the roller grill.
C-stores that look at their assets — broad menus, hidden kitchens and great locations — and combine them to serve the digital future have the opportunity to outgrow the category by changing the basis of competition. This article was originally posted on the CStore Decisions.