Ghost (Virtual) Restaurant

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Startup Costs: $10,000 - $50,000
Franchises Available? No
Online Operation? No

THE BRIEF: 

With the popularity of food delivery services such as Uber Eats, Seamless, Grubhub, DoorDash and Postmates, ghost, or virtual, restaurants have sprung up to meet demand. These businesses focus strictly on delivery and takeout, and do not provide areas for dining, keeping overhead lower than a typical restaurant.

ASK THE PROS:

How much money can you make? 

With lower overhead and reduced staff, the earning potential for ghost restaurants will depend on how many orders you fill. And this segment of the industry is growing. According to McKinsey & Company, food delivery accounts for 1 percent of the total food market and 4 percent of food sold through restaurants and fast-food chains. It's expected to grow 3.5 percent each year for the next five years.

What kind of experience do you need to have?

Prior restaurant experience is a given. You'll need to be able to manage a kitchen staff to make sure orders are delivered in a timely manner. You'll also need to maintain relationships with delivery services, and make sure your restaurant can easily be found online.

What’s the most important thing to know about this business?

The greatest strength a ghost restaurant has is flexibility. You could operate these businesses out of a shared kitchen to reduce costs, or even run multiple ghost restaurants out of the same kitchen. That flexibility also extends to the menu, which can be adjusted and tinkered with on a regular basis.

"Since a ghost restaurant can’t rely on foot traffic for patrons, it is important that these businesses have savvy marketing approaches. This being said, flexibility and nearly-instant gratification are two things that make ghost restaurants the perfect foodservice business to cater to young customers. Especially if you choose to target teens and young adults as your customer base, it is best that your virtual restaurant has a strong online presence."—WebstaurantStore Blog

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