Close Ad

The Spoon

Daily news and analysis about the food tech revolution

third-party delivery

Bite Squad Launches Campaign to Deliver Meals to Needy Families This Thanksgiving

It’s not even Halloween yet, but already grocery store displays are showing off pumpkin pie filling, boxed stuffing, and other accoutrements to the traditional Thanksgiving meal. But with 37 million people in the U.S., including 11 million children, currently struggling with hunger, putting an elaborate holiday feast together is a stretch for many, out of the question for some.

On-demand food service Bite Squad has responded to the problem today by announcing a new campaign to deliver hot meals on Thanksgiving to thousands of families in need. Called Share Thanksgiving 2019, the program originally belonged to food delivery service Waitr, which Bite Squad acquired in 2018. It works like this: from today until November 5, restaurants are invited to commit to donating meals to families in need. Meanwhile, Bite Squad-Waitr employees and customers can nominate families. Bite Squad will also work with local community organizations to identify those most in need.

From the campaign page:
Over the next month, Waitr and Bite Squad employees and members of the local community will nominate families in need for the program. During this period, when anyone orders from Waitr, the company will make a donation that will go toward covering the cost of the meals. Each meal will be prepared by participating restaurant partners, allowing us to jointly provide eligible families with (literally!) restaurant-quality meals.

Just before Thanksgiving day, volunteer employees will come together to deliver the meals to the families.

Waitr founded the campaign in 2017, when it delivered 1,000 Thanksgiving meals to families in need. That number doubled in 2018, and this year, the Waitr-Bite Squad entity said it aims to share over 4,000 meals across 50 U.S. Waitr-Bite Squad markets. That includes the following states: Alabama, Arkansas, Florida, Georgia, Hawaii, Louisiana, Minnesota, Mississippi, North Dakota, South Carolina, South Dakota, Tennessee, Texas, Virginia, and Wisconsin.

We’ll be keeping an eye out over the next few weeks for other restaurant and food companies doing their part to help the needy this Thanksgiving. (Know of any? Drop me a line.) In the meantime, those interested in Bite Squad’s program can nominate a family here.

Wendy’s Ramps Up Its Digital Order and Delivery Strategy

Wendy’s is intensifying its efforts around digital order and delivery, announcing at an Investor Day call last Friday that it is aiming to make digital sales 10 percent of all orders by 2024. Right now, digital sales account for 2 percent of orders.

Earlier this year, the Dublin, OH-based chain said it was investing an incremental $25 million into building “a stronger foundation” across its digital platforms. So far, that move to play catch up to its competitors appears to be paying off. At Investor Day this past Friday, Wendy’s Chief Digital Experience Officer Laura Titas noted in a presentation that check sizes are now 20 percent larger with mobile orders. For delivery specifically, the chain now sees check sizes 50 to 60 percent larger.

Titas’ presentation also suggested delivery will be key towards helping Wendy’s reach its 2024 goal for digital sales. To that end, she outlined multiple initiatives around improving the delivery experience.

For starters, it’s adding more delivery services. Wendy’s has partnered with DoorDash since 2017. Next year, the chain will expand its reach with third-party delivery to include Uber Eats and Grubhub, too.

And as is the case with many chain restaurants, QSR or otherwise, Wendy’s isn’t focusing its delivery strategy solely on those third-party partnerships. Instead, it will also launch what Titas called “in-app delivery,” where, thanks to a POS integration, Wendy’s can also process orders directly through its own app. While she didn’t give too many details, Titas said she expects this direct integration to knock three to five minutes off the delivery process. Meanwhile, the arrangement will also allow Wendy’s to track customer data more precisely.

Geolocation capabilities, to improve delivery and help ensure that customers are ordering from the right (i.e., the closest) Wendy’s, voice-order via Google Assistant, and a long-needed loyalty program were all announced at the Investor Day event as well.

Wendy’s certainly has its work cut out when it comes to evolving into a tech-forward restaurant company. Between Burger King’s many publicity stunts to drive mobile orders and McDonald’s turning itself into a tech company, competition is only growing fiercer when it comes to retaining customer loyalty. But with 60 percent of all restaurant orders now off-premises, there’s also a lot of room for growth and new audiences to grasp for those who can make their reach wide enough.

DoorDash Launches Its First Ghost Kitchen Facility for To-Go Restaurant Concepts

With more and more restaurants, food entrepreneurs, and delivery services using ghost kitchens, it seemed only a matter of time before DoorDash built one of its own. So it’s not too surprising that today, the San Francisco-based company announced the launch of its first ever shared commissary kitchen, dubbed DoorDash Kitchens, which will house multiple to-go restaurant concepts under a single roof, according to an email sent to The Spoon.

DoorDash customers can now order from a handful of chain restaurants and either pick up food right at the commissary or have it delivered. This first location of DoorDash Kitchens, located in Redwood City, CA, will serve several cities in the California Peninsula area, including Menlo Park, Palo Alto, and Woodside, among others.

DoorDash has partnered with four restaurant chains for this first run of DoorDash Kitchens: Nation’s Giant Hamburgers, Rooster & Rice, Humphry Slocombe, and The Halal Guys.

The biggest benefit for those merchants, as well as any others that might come onboard in the future is geographic reach. “Over time we’ve heard that our partners have been looking for new ways to grow their business,” Fuad Hannon, Head of New Business Verticals for DoorDash, said to me over the phone. “Launching new geographies is one of the most clear ways that we can help.”

It’s also a cheaper option for a restaurant than building a new location from the ground up, or even retrofitting an existing building. “For merchants, it means reaching new audiences without bearing the high costs of building out more brick-and-mortar locations,” Hannon said of the Kitchens concept.

So, for example, Nation’s Giant Hamburgers has no brick-and-mortar locations currently in Palo Alto. However, operating out of a commissary kitchen nearby allows the chain to reach customers in that area without incurring costs around building infrastructure, permits and licenses, or maintaining a dining room setup. Hannon said DoorDash provides the restaurants with kitchen space and proper equipment, and also handles things like permitting and last-mile logistics for the businesses. “It’s really quite turnkey for our partners,” he said.

A little less clear is how many of these kitchens DoorDash plans to build around the U.S. in future. Hannon wouldn’t say if more locations are already planned. But according to recent numbers, 60 percent of all restaurant orders are now off-premises, and ghost kitchens help restaurants fulfill much of this demand. Just look at Kitchen United’s growing empire, the amount of work Starbucks is putting into the concept, and even efforts from DoorDash competitors like Uber Eats and Grubhub.

All of which is to say that ghost kitchens are starting to become table stakes for restaurants, and it would be more surprising if we didn’t see additional locations from DoorDash in future.

DoorDash Now Holds 35 Percent of Consumer Spend in Third-Party Delivery

DoorDash’s growth continues outpacing its competitors in the third-party delivery space, according to a new report. This week Edison Trends released data on the third-party delivery market that shows DoorDash leads the competition with 35 percent market share of consumer spend, followed by Uber Eats (25 percent) and Grubhub (23 percent).

The lead DoorDash currently enjoys is not surprise, as it’s been a big year for the San Francisco-based service. The company now offers delivery in all 50 U.S. states and was the first to do so. Its $410 million acquisition of Caviar in August gave the service an even wider reach, and over the last 12 months DoorDash has been scoring deals a plenty with major restaurant chains as well as expanding service to other continents.

Right now, DoorDash’s lead is a small one, though. As Edison points out, the company shared “approximately the same market share of consumer spend” with Grubhub and Uber Eats at the beginning of 2019, so a small lead now doesn’t necessarily mean total dominance for the foreseeable future. All of these companies are still looking for ways to boost user loyalty to their specific platforms, not to mention reach some level of profitability.

What’s interesting about DoorDash is that, as a service, it doesn’t tend to dabble in many initiatives outside of partnering with restaurants and acquiring companies that will help deliver food faster. By contrast, Uber Eats seems forever unrolling new features on and off its app, and Grubhub is of late fixed on launching digital-only concept restaurants. Postmates, meanwhile, appears to be turning its attention to large-scale venues like baseball stadiums.

It’s possible part of DoorDash’s lead is due to its simpler-is-better approach, which focuses primarily (though not exclusively) on expanding service and increasing restaurant choice. Whether this is the winning strategy remains anything but certain.

Grubhub and Just Salad Partner for a Digital-Only Concept Restaurant

Grubhub just added another virtual restaurant concept to what’s quickly becoming a string of them for the third-party delivery service. Today, the company announced a partnership with NYC-based fast-casual chain Just Salad to launch a virtual restaurant called Health Tribes. Starting today, the Health Tribes menu is available exclusively for delivery and pickup orders placed via Grubhub or Just Salad apps and websites, according to a press release sent to The Spoon.

The overall concept of Health Tribes is around today’s most popular diet plans such as vegan, gluten-free, Paleo, and Keto. The virtual restaurant claims it will help customers more easily find delivery meals that meet those specific criteria eating needs and/or preferences.

It’s not clear in the press release if the meals will be made onsite at Just Salad locations or if Grubhub will use ghost kitchens for production, as it’s done with other virtual restaurants.

Health Tribes isn’t the first nutrition-focused delivery-only concept for Grubhub. The company teamed up with the Whole30 brand and restaurant company Lettuce Entertain You in August to launch a delivery-only restaurant based on the Whole30 diet. In the case of that “restaurant,” all food is made in a ghost kitchen run by Lettuce Entertain You.

Ditto for Grubhub’s other virtual restaurant concept, which it also runs in partnership with Lettuce Entertain You along with magazine-turned-digital food brand Bon Appétit. Bon Appétit Delivered, as it’s called, offers gourmet meals created by the folks at the Bon Appétit Test Kitchen.

Both that and the Whole30 concept are currently only available in Chicago. The Just Salad collab will be more widely available, as the chain has over 50 locations throughout Chicago, NYC, Philadelphia, and other cities.

Health Tribes more or less confirms the idea that these digital-only concept restaurants are going to become a regular staple of Grubhub’s offerings. With ghost kitchens becoming more commonplace in the food world, third-party delivery services need to find new ways to differentiate themselves. Grubhub isn’t the only service trying ghost kitchen restaurants: Both Uber Eats and Deliveroo are testing out concepts as well. Where Grubhub stands apart slightly is with its focus on building virtual restaurants around specific diets and with food brands that aren’t necessarily restaurants. Expect that to be something we’ll see much more of from Grubhub in future.

Domino’s Is Losing Its Legal Battle Over Website Accessibility. Good

The U.S. Supreme Court has declined to hear an appeal from Domino’s fighting a ruling that a blind customer could sue the chain for violation of the American Disabilities Act (ADA) after he couldn’t use the Domino’s website to order a pizza. The ruling comes at a time when the restaurant experience is more digital than ever thanks to the growing popularity of things like mobile ordering, delivery, and ghost kitchens. It will also likely trigger more action on the part of restaurant chains to make their digital properties accessible to those with disabilities.

For a quick backstory, in July, Domino’s petitioned the U.S. Supreme Court after the U.S. Court of Appeals for the Ninth Circuit ruled in favor of California resident Guillermo Robles, a blind customer who filed the lawsuit after two failed attempts to order a customized pizza from the Domino’s website and app. Robles argued that protections under the ADA apply to online properties as well as brick-and-mortar ones. Domino’s refuted the point, stating that the ADA regulations were written long before digital restaurant ordering existed and that the government hasn’t yet issued rules on how businesses should make their websites ADA compliant.

The puzzling element of this case has always been that Domino’s is a massive entity with ample resources to put towards improving the way its website and app functions for the disabled. That Domino’s prides itself on being more a tech company these days than a pizza chain makes the case even more of a head scratcher. You would think a company that wants to be known for its technology-forward approach to business would be falling over itself to set the standard for ADA-compliant digital properties.

But the opposite seems to be true. Domino’s has instead argued that the recent “tsunami of website accessibility litigation” by plaintiffs is “exploiting the absence of a standard for their own benefit” and that federal standards need to be put in place.

While it’s true that digital properties present more challenges when it comes to staying ADA compliant, Domino’s argument overall has been weak from the start. Rather than use the case as an opportunity to help create clearer regulations and become known as a champion of more ethical tech, the chain has instead chosen to spend millions of dollars fighting a ruling it will in all likelihood still have to comply with.

It’s estimated that blindness in the U.S. is expected to double to more than 8 million people by 2050. Meanwhile, around 26.9 million U.S. adults have some vision loss.

At the same time, though, more than 5 billion people own mobile devices, at least half of which are smartphones, the restaurant experience is only getting more reliant on digital properties. Add to that the rising popularity of delivery-only ghost kitchens, which wouldn’t exist without digital devices, and it’s easy to see why the issue of restaurants making their properties ADA compliant is so urgent now.

While a large number of restaurant websites are still not designed for ADA compliance, this week’s ruling should certainly motivate other chains to provide an acceptable level of service via digital properties to those with visual, auditory, and cognitive disabilities. If Domino’s is smart, it will start using some of its innovation muscle to be part of the solution, rather than continuing to paint itself as the villain of the story.

The Week in Restaurants: Papa John’s Hearts Food Delivery Apps, OpenTable Expands Delivery Options

We’re neck-deep in final preparations for The Spoon’s Smart Kitchen Summit, which kicks off Monday morning in Seattle. (There’s still time to snag a ticket, btw.) But news doesn’t stop just because we’re throwing a fab event, and for the restaurant industry, it was business as usual this week. Before I hop on a plane and head west, here are a few more pieces of restaurant-tech news from the last few days.

Papa John’s Publicly ‘Embraces’ Third-Party Delivery Apps
Still coming back from controversy that rocked its bottom line, Papa John’s made its stance on third-party deliver clear to the public this week when new CEO Rob Lynch told CNBC that third-party food delivery apps are “an opportunity” for the company, not a threat. This is a direct contrast to Big Pizza rival Domino’s, who staunchly keeps all delivery operations in house. Lynch, on the other hand, says his company continues to meet with multiple third-party delivery services (Papa John’s signed on with DoorDash in March). These apps, he said, have “an impact on our industry, an impact on business. But we believe that’s because we haven’t worked strategically with them.”


Free News Courtesy of Starbucks
As of September, Starbucks quit selling paper copies of national newspapers, which means no more scanning the nearby print copy of NY Times while you wait for your latte. But you can still do it digitally, for a limited time. In a blog post this week, the coffee giant said it is providing “complimentary digital news” with its free in-store Wi-Fi in the U.S. Sites participating include The Wall Street Journal (WSJ), USA Today, The Seattle Times, Chicago Tribune, The Baltimore Sun, Orlando Sentinel and New York Daily News. Many of these papers have subscription paywalls in place that normally limits the amount of content you can see on the website for free. Starbucks also said it will offer discounted subscriptions for print and digital subscribers to the WSJ.

OpenTable Expands Delivery Options to Canada
OpenTable is expanding its delivery capabilities with Uber Eats to Canada, following the launch of the same feature in the U.S. in July. To be clear, you can’t order and pay for food direct from the OpenTable app. Instead, diners perusing restaurants on the OpenTable iOS app will see a “Get it delivered” button and be redirected to the Uber Eats app. It’s another way the company is trying to evolve into more than just a platform for booking restaurant reservations, and in doing so, keep customers inside the figurative walls of its own ecosystem as much as possible.

Revention Unveils New Restaurant Tablet Software
It’s another day and another tablet in the restaurant industry. Point of sale (POS) and mobile order platform Revention launched its own tablet software this week that integrates with the company’s existing POS and mobile order system. The new software, which is compatible with both iOS and Android tablets, promises to streamline restaurant operations, from entering an order to managing and training staff, and works both online and offline. Revention counts Dairy Queen, the Santa Cruz Beach Boardwalk, and numerous pizza chains, including mall favorite Sbarro, among its customers.

Report: 60 Percent of Restaurant Orders Are Now Off-Premises

Off-premises dining — that is, delivery, takeout, and drive-thru orders — now accounts for 60 percent of restaurant occasions, according to a new report developed by Technomic for the National Restaurant Association. The report, which was released yesterday and digs into the factors driving the demand for off-premises orders, also notes that this trend will continue to grow and that restaurant operators who don’t yet have a strategy for off premises in place “risk being left behind.”

For consumers, drive-thru topped the list of the types of off-premises dining consumers use, with 92 percent surveyed saying they ordered via that channel at least once per month. Takeout was next, at 90 percent, followed by restaurant delivery at 79 percent and delivery via third parties (e.g., DoorDash, Grubhub, etc.) at 53 percent.

Restaurant operators are responding with more of these channels, though what they offer the most doesn’t align exactly with what consumers use. Among those restaurant surveyed, 93 percent offer takeout, followed by 66 percent doing third-party delivery, 55 percent with their own delivery operations, and 20 percent offering drive-thru.

The difference in numbers makes sense, though. For example, most non-QSR restaurants (think Olive Garden or Outback) wouldn’t have a delivery window. And more restaurants embrace third-party delivery because, for now at least, it’s cheaper to let, say, Grubhub handle the logistics and actual couriers involved in getting food from restaurant to customer.

All that said, The Association notes that operators are “not keeping up with consumer demand for technology,” which is at the heart of most of these sales channels. Twenty-nine percent of operators said they are “lagging the industry,” citing things like high costs or not enough demand to justify the cost. There’s also the matter of getting both staff and customers on board with new technologies. For example, will customers actually use a self-service kiosk if it’s installed in the front of house?

Well, that depends on the kiosk. Or digital menu board. Or mobile app. Generally speaking, the easier and more intuitive it is to use the technology, the more people are likely to use it, which is one of the reasons voice tech is becoming known in the restaurant industry as a promising solution, particularly in the drive-thru. However, some of these more advanced technologies are also some of the least prevalent, according to the report: “More advanced technologies that operators report as being most impactful to their business—location intelligence, geofencing and virtual assistants used for voice ordering—are also the least available technologies that operators currently have in place.”

Nonetheless, as the report makes clear and as we discuss often here at The Spoon, tech is the driving force behind the movement towards off-premises dining, and also the critical means by which restaurants can serve more of these customers and improve their tools. Over the next year, that 60 percent of off-premises orders will only grow. Restaurants must ensure they have the right elements in place to help them climb with it.

Google and Olo Partner to Give Restaurants More Control of Their Data

This week, Google announced a partnership with digital ordering platform Olo that will let restaurants offer pickup orders through Google Search and Maps, and Google Assistant without incurring high commission fees from third-party services or losing valuable customer data.

Restaurants use Olo to simplify the process of taking delivery and pickup orders from multiple third-party channels. Via Olo’s Rails technology, a restaurant can consolidate all those orders into a single ticket stream that goes directly through the business’ main POS system, eliminating the need for a human to manually input that information.

Previously, restaurants integrating with Google had to go through third-party services like Postmates, DoorDash, and Delivery.com. Users ordering food through Google would select meals via Maps, Search or Assistant, then be redirected to one of those third-party services to complete the transaction. While convenient for the user, restaurants still had to pay the high commission fees third-party services charge per order.

According to a press release sent to The Spoon, the new Google/Olo partnership directly integrates Rails into Google Search, Maps, and Assistant. That means Olo’s network of restaurants, which numbers over 70,000 at this point, can process orders via these channels without having to go through a third-party site. Restaurants not only get to keep the money they would have otherwise spent on commission fees, they also get to keep their customers’ data, which is one of the most valuable assets in the restaurant industry these days.

Currently, the deal applies only to pickup orders. Olo clients Checker’s and Portillo’s Hot Dogs are two chains working initially involved in this new partnership.

The deal is also one more push from Google towards becoming a major player in the food tech world, particularly in restaurants. Besides integrations with Olo and third-party delivery services, the search giant has also added menu recognition features to Google Lens, so a user can point their phone at a menu to highlight popular dishes, and offers a “popular dishes” feature to Maps. In May, Google created a virtual phone agent for small businesses like restaurants and gotten approval to make public drone deliveries. Google also has a delivery program in place with Olo’s rival platform, ChowNow.

For now, Google’s expansion across the restaurant business remains purely digital. Even so, one can’t help but wonder if the company would eventually explore brick-and-mortar initiatives, as well. For example, Google already runs and partners with coworking spaces; it could start doing a similar program for shared kitchens.

Regardless of whether something like that actually happens, Google is sure to keep pushing to become a vital player of the restaurant network.

Correction: An earlier version of this post stated the Google/Olo deal applied to restaurant delivery orders.

Uber to Merge Its Rideshare and Eats Apps, Partners With Rachel Ray for a Ghost Kitchen

At its event yesterday in San Francisco, Uber unleashed a slew of announcements and updates to its app, including merging Uber Eats into its main rideshare app, expanding its rewards program, and several other improvements geared towards bolstering the presence of Uber Eats in customers’ everyday lives.

Of all the food-centric news to come out of the event, what’s most interesting to us over here at The Spoon is Uber’s continued focus on ghost kitchens. The company announced yesterday it has teamed up with Rachel Ray to open a virtual restaurant whose menu will only be available on Uber Eats.

A blog post from Uber offered some details, though not a ton. The limited-time “restaurant” will run for 10 weeks in 10 cities and be timed with the launch of Ray’s new cookbook. Uber didn’t specify which cities and exactly when the launch will happen, but presumably the food will be cooked in one of the company’s growing number of ghost kitchens and delivered out to customers in a nearby radius.

The initiative highlights a new trend we’re seeing more of in ghost kitchens, which is using them to launch non-restaurant concepts that would be prohibitively expensive to test out in a traditional brick-and-mortar setting. Uber isn’t alone in this new arena: Grubhub has already launched two such initiatives, including a partnership with food publication Bon Appétit, which was announced earlier this week. Partnerships with big-name chefs seem a logical next step, and while the Uber-Rachel Ray deal is for a very limited time, it’s likely the first in what will be a long string of similar partnerships in future.

Rachel Ray wasn’t the only deal announced at the event yesterday. Uber Eats also unveiled an exclusive food delivery partnership with fast-casual chain Sweetgreen. Interestingly, the announcement comes the same week Sweetgreen closed a $150 million funding round and said it will launch its own in-house delivery service.

Uber made multiple other announcements yesterday that will affect Eats, including the news that it will merge its food delivery app into its main ride-hailing app. This “next generation of the Uber app,” as the company called it in a blog post, is currently testing two different versions of this new interface in “hundreds of U.S. and international cities.”

The company also highlighted allergy-friendly filters, which will let Eats customers communicate more effectively with restaurants about their dietary restrictions, and its forthcoming plans to make extras like cutlery and straws available only upon request.

With growth of its ride-hailing service stalling, including less-than-stellar earnings reports from Q2, it makes sense Uber is continuing to focus on its Eats business, though that business has yet to become profitable, either, and, as Uber CEO Dara Khosrowshahi noted on the Q2 earnings call, won’t be for some time. Whether celebrity chefs and allergy filters can actually make any real progress towards changing that remains doubtful.

Outback Steakhouse Creates a Hybrid Delivery Strategy With Exclusive DoorDash Partnership

Restaurant company Bloomin’ Brands announced this week that its Outback Steakhouse brand has partnered with DoorDash for an exclusive delivery program. Not only does the deal make Outback the largest steakhouse available via the DoorDash platform, it also puts the chain on a growing list of restaurants applying a more hybrid approach to delivery, one that utilizes a combination of third-party services and in-house capabilities.

Bloomin’ has actually spent the last couple of years developing an in-house delivery program used by both Outback and another of its brands, Carrabba’s. With this program, customers place orders directly via the Outback or Carrabba’s apps and the company handles its own drivers to transport the food from the restaurant to the customer’s doorstep.

But on the company’s recent Q2 earnings call, Bloomin’ CEO Dave Deno noted that, “We recently came to terms of the national third-party delivery provider. This channel will complement our existing platform. Importantly this will help expand our reach to customers who are loyal to the third-party delivery companies.” 

It’s not a surprising conclusion for a company to draw, given that third-party delivery apps like those from DoorDash, Grubhub, and Uber Eats are expected to have upwards of 44 million users by 2020 in the U.S. alone.

The DoorDash partnership will act to complement, rather than replace, Bloomin’s existing in-house program. It also makes Outback and Bloomin’ the latest in a series of restaurant companies adopting a hybrid approach to delivery, where incoming orders come from both the restaurant’s in-house app as well as those of third-party delivery services. Panera, one of the most well-known chains to keep delivery operations in house, announced in August it was adding multiple third-party partners to its strategy.

For Outback, the move to add third-party delivery is also in keeping with a trend highlighted in another report, Toast’s recent Restaurant Success in 2029 survey. That report noted the amount of variety today’s restaurant customers look for in terms of delivery options, and suggested large restaurant chains use a combination of both in-house functionality and third-party delivery apps.

However, the Toast report also said it was “extremely important for restaurants to be represented across multiple third-party delivery platforms.” In that sense, Outback is going against the tide in some respects by signing an exclusive deal with DoorDash. Even McDonald’s recently ended its longstanding exclusive deal with Uber Eats to add more third-party services.

This week’s press release noted that Bloomin’ chose DoorDash as its delivery partner “for the next phase of its omnichannel approach to delivery” for Outback. That could well mean the company plans to add more partners in future as it continues its navigating the phases of its delivery strategy.

Fatburger Is Turning Los Angeles Stores Into Ghost Kitchens for Its Sister Brand

Southern California QSR chain Fatburger is turning 15 of its Los Angeles locations into ghost kitchens for Hurricane Grill & Wings, one of its sister brands, according to a post this week from Nation’s Restaurant News. Both chains are owned by Los Angeles-based restaurant company FAT Brands.

Hurricane Grill & Wings has restaurant locations across Florida as well as in New York, New Jersey, and a handful of other states. A store for Chula Vista, CA is in the works, but at present, the chain has no locations in operation in the state of California. However, thanks to Fatburger’s newly launched ghost kitchens, customers in Los Angeles will be able to access the Hurricane menu when ordering for delivery.

The limited version of Hurricane’s menu will feature the chain’s wings as well as a few other items like onion rings, fries, and soft drinks. The menu will only be available for delivery customers who order via the usual suspects of third-party delivery: Grubhub, Uber Eats, Postmates, and DoorDash.

To be clear: The virtual Hurricane restaurants aren’t displacing those Fatburger locations. Rather, Fatburger’s kitchens will do double duty, with cooks trained to make food from both menus.

Like any other ghost kitchen, Hurricane’s will be a completely unseen operation. There’s no dining room involved — customers who eat in at Fatburger locations doubling as ghost kitchens will not be able to order off the Hurricane menu, which, as mentioned above, will be available solely through third-party delivery channels.

For a restaurant company trying to grow multiple brands at once, a move like FAT Brands’ is a smart play towards enticing new customers who might be fans of one restaurant chain but wouldn’t otherwise be exposed to another. Turning existing real estate into a ghost kitchen for another brand is a way to expose customers to more of those choices without incurring the high costs and thin margins of a full restaurant location that includes a dining room.

And in a restaurant business where delivery is becoming increasingly mandatory, enticing customers to try a new brand through delivery also potentially increases a business’s off-premise sales — something that would not only make investors happy during earnings calls, but could also give a brand more power negotiating commission fees with third-party delivery services.

According to NRN, FAT Brands wants to expand ghost kitchens for the Hurricane chain to 12 more Fatburger locations in the fourth quarter, and eventually apply the concept across its entire brand portfolio.