Back at the Smart Kitchen Summit in 2019, Adam Brotman, the CEO of restaurant tech startup Brightloom, suggested if he was a young entrepreneur and wanted to start a restaurant business, he’d create a ghost kitchen powered by a food making robot.
I haven’t stopped thinking about this comment ever since.
The combination of food produced via robots with a ghost kitchen model makes so much sense, in part because both are new approaches that help reduce two of the most significant cost drivers of the legacy restaurant business: real estate and labor.
Consider the real estate costs of starting a new sit-down restaurant. Some estimates put the typical down payment required for the commercial space somewhere between $150 to $350 thousand dollars in a market like LA. And that’s before you even get to the cost of renovation and installing a new kitchen, which can cost up to a quarter of a million bucks.
And then there’s labor. A typical fast-food restaurant has to factor in about 25% of sales will go to labor. A fine dining restaurant will pay even more, often up to 40%. For a spot that generates a million dollars a year in top-line revenue, this translates to $400 thousand annually in labor expenses.
That’s a lot of money, and no doubt a big part of the reason about one-third of restaurants don’t make it in normal times, let alone in an era ravaged by a pandemic.
And so, in 2021, it’s not that surprising to see several groups experimenting with ways to combine the idea of new dark kitchen models with automation. Here are just a few:
Pizza HQ: The founders of Pizza HQ are experienced sit-down pizza restaurant operators, but they are betting the future on a robot-powered dark kitchen model. The company is creating a centralized pizza production facility in New Jersey that will utilize up to four Picnic pizza robots and also develop a network of smaller fulfillment centers around the greater northern New Jersey area.
800 Degrees: Another pizza chain, 800 Degrees, is betting its future on a combination of ghost kitchens and automated pizza production. The company is working with ghost kitchen operator Reef to expand to up to 500 ghost kitchens over the next few years, many of which will include Piestro’s robotic pizza kiosks.
Cala: This French company has created a unique pasta-making robot that enables both customer pick up and third-party delivery of its dishes. This model of automated production via kiosk as well as delivery will be a popular hybrid model that enables operators to tap into multiple customer dining revenue streams.
Hyper-robotics: Hyper has created a containerized robotic pizza kitchen that can plug into a dark kitchen model or be used in a hybrid ghost and delivery/consumer pick-up restaurant.
Kitchen United/Kiwibot: While Kitchen United hasn’t announced any deals automating their food production via robotics, the ghost kitchen pioneer has started experimenting with the use of delivery robots to ship food produced in their kitchens to customers.
Nommi: Nommi is a new joint venture creating a bowl-food robot that can be utilized in a variety of ghost kitchen formats. According to company president Buck Jordan, the company also plans to work on technology that could eventually hand robot-produced food to a delivery robot to create an “end-to-end” food robot model from production to the customer doorstep.
These are just a few examples, and we haven’t even gotten to the dozens of food robot startups building systems that could power food production in a ghost kitchen space. Companies like Beastro, Mezli, Middleby and others are working on self-contained food-making robots that could serve as enabling platforms for an entire new industry built around centralized automated food production made exclusively for digital orders.
One could argue the first company to try a robot-powered ghost kitchen model was Zume. The once high-flying startup raised hundreds of millions to create a roboticized dark pizza kitchen model to deliver pizza around the bay area using its high-tech oven equipped trucks. The company eventually shut down its robot pizza business, in part because like many pioneering startups, Zume never figured out an operating model that works (in retrospect, developing custom-built delivery trucks was probably an unnecessary use of venture funding).
But now, many of the companies following in Zume’s wake are building interesting and what looks like more sustainable businesses, in large part because they are working in partnership with restaurant operators who know the business and are savvy in building virtual restaurant businesses optimized to use third party delivery. While some of these models may eventually fail, it’s pretty clear that robotics and ghost kitchens are a combination that will play a big role in the restaurant industry’s future.
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