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New types of restaurants are popping up: 1) Ghost kitchens that only serve via delivery apps. You can save on rent by setting it up in an area with no foot-tra

by pradn 7y ago

New types of restaurants are popping up: 1) Ghost kitchens that only serve via delivery apps. You can save on rent by setting it up in an area with no foot-traffic. You can also get economies of scale. 2) Restaurants with dedicated entrances for delivery drivers. Baar Baar in NYC has a separate place where delivery workers can wait. In other restaurants, they have to wait in the limited dining area. One hopes that the workers still get to use restrooms & get some water, etc.

notyourday 7y ago
> 1) Ghost kitchens that only serve via delivery apps. You can save on rent by setting it up in an area with no foot-traffic. You can also get economies of scale. You can't. This is the kind of a mistake that all first time entrepreneurs make. Delivery costs too much money. Logistics of getting your labor force to your kitchen is a nightmare. > 2) Restaurants with dedicated entrances for delivery drivers. Baar Baar in NYC has a separate place where delivery workers can wait. In other restaurants, they have to wait in the limited dining area. One hopes that the workers still get to use restrooms & get some water, etc. This was tried in NYC during first dot com. Remember purple shirts? They had a competitor with green shirts. That's the unproductive spaces. Rent hikes wiped those out. Edit: Blind downvotes are laughable. Go walk into your local pizza place and talk to the owners. They will tell you why they are slowly dropping off all the apps. They are giving equivalent of a 20-30% discount in fees for the area they already deliver in. Ghost kitchens are mostly scams. The ones that aren't are ran out of commissary commercial kitchens that cost an arm and a leg. The "ghost kitchens" are mostly not really legal, sometimes ran out of a house, marketing same stuff under different names. Most of the restaurant overhead for small places does not come from the rent of the floor space. It comes from the rent of the kitchen and compliance with the health codes. And, unlike say taxi commissions, health departments take no crap, which is why the ghost restaurants disappear rather quickly. It is the "no one did it before" idea of people who have never ran restaurants. It always flops. If it did not, Union Sq Hospitality would have been doing it for years.
- wpietri 7y ago
  I'm not sure why you're getting downvoted. A beloved restaurant near my house is closing down, and the owner is pretty clear about how ugly the economics of delivery are: https://missionlocal.org/2019/05/custards-last-stand-mission-pie-vs-the-gig-economy/ https://missionlocal.org/2019/05/custards-last-stand-mission...
  - pkulak 7y ago
    Whoa, I had no idea the commissions were that high.
- chipotle_coyote 7y ago
  I'm not sure why all the downvotes here, either. In the SF Bay Area, several companies have tried to be "delivery only restaurants" and they've mostly all been failures -- some spectacular VC-assisted flameouts, some quiet fades.
- arcticfox 7y ago
  Dismissing things in 2019 by referencing that they were tried in the dotcom bubble ... Two decades ago ... Is not a very powerful argument
  - setr 7y ago
    Isn’t the whole point of history... to learn from it?
  - wpietri 7y ago
    Are you suggesting that something changed to make this different? If so, what?
    - sokoloff 7y ago
      Smart phones (the associated app ecosystem, constant IP connectivity, GPS, and stored payment methods) and better computer mapping/route planning systems being ubiquitous. I remember around 2000 in order to order ice cream for delivery having to call Kozmo (or maybe it was Webvan) on a voice phone and talk to a person like some kind of savage. It seems like the smartphone and good map data could transform something that was terribly inefficient 20 years ago into something that's efficient enough to be profitable now.

by pradn 7y ago

notyourday 7y ago

> 1) Ghost kitchens that only serve via delivery apps. You can save on rent by setting it up in an area with no foot-traffic. You can also get economies of scale. You can't. This is the kind of a mistake that all first time entrepreneurs make. Delivery costs too much money. Logistics of getting your labor force to your kitchen is a nightmare. > 2) Restaurants with dedicated entrances for delivery drivers. Baar Baar in NYC has a separate place where delivery workers can wait. In other restaurants, they have to wait in the limited dining area. One hopes that the workers still get to use restrooms & get some water, etc. This was tried in NYC during first dot com. Remember purple shirts? They had a competitor with green shirts. That's the unproductive spaces. Rent hikes wiped those out. Edit: Blind downvotes are laughable. Go walk into your local pizza place and talk to the owners. They will tell you why they are slowly dropping off all the apps. They are giving equivalent of a 20-30% discount in fees for the area they already deliver in. Ghost kitchens are mostly scams. The ones that aren't are ran out of commissary commercial kitchens that cost an arm and a leg. The "ghost kitchens" are mostly not really legal, sometimes ran out of a house, marketing same stuff under different names. Most of the restaurant overhead for small places does not come from the rent of the floor space. It comes from the rent of the kitchen and compliance with the health codes. And, unlike say taxi commissions, health departments take no crap, which is why the ghost restaurants disappear rather quickly. It is the "no one did it before" idea of people who have never ran restaurants. It always flops. If it did not, Union Sq Hospitality would have been doing it for years.

wpietri 7y ago
I'm not sure why you're getting downvoted. A beloved restaurant near my house is closing down, and the owner is pretty clear about how ugly the economics of delivery are: https://missionlocal.org/2019/05/custards-last-stand-mission-pie-vs-the-gig-economy/ https://missionlocal.org/2019/05/custards-last-stand-mission...
- pkulak 7y ago
  Whoa, I had no idea the commissions were that high.
chipotle_coyote 7y ago
I'm not sure why all the downvotes here, either. In the SF Bay Area, several companies have tried to be "delivery only restaurants" and they've mostly all been failures -- some spectacular VC-assisted flameouts, some quiet fades.
arcticfox 7y ago
Dismissing things in 2019 by referencing that they were tried in the dotcom bubble ... Two decades ago ... Is not a very powerful argument
- setr 7y ago
  Isn’t the whole point of history... to learn from it?
- wpietri 7y ago
  Are you suggesting that something changed to make this different? If so, what?
  - sokoloff 7y ago
    Smart phones (the associated app ecosystem, constant IP connectivity, GPS, and stored payment methods) and better computer mapping/route planning systems being ubiquitous. I remember around 2000 in order to order ice cream for delivery having to call Kozmo (or maybe it was Webvan) on a voice phone and talk to a person like some kind of savage. It seems like the smartphone and good map data could transform something that was terribly inefficient 20 years ago into something that's efficient enough to be profitable now.