Wow Bao’s partner kitchen program, which lets other restaurants make and serve its food products, will reach 1,100 locations by the end of 2021, up from 150 now, according to a press release from the company. The anticipated milestone highlights another format of virtual restaurant emerging as restaurants take more business off premises.
Via the partner kitchen program, restaurants cook some of the Wow Bao brand’s signature items — buns, bowls, potstickers, etc. — then sell them on the usual third-party delivery channels. Wow Bao CEO Geoff Alexander told me last year that the idea is to provide any type of restaurant with a relatively easy way to add some much-needed revenue.
“We believe we have created something restaurants can survive with,” he said at the time.
Restaurants pay a flat fee to participate (~$1,000) that covers supply chain, marketing, and any extra equipment needed. From there, Wow Bao’s food is marketed on third-party delivery platforms via an entirely separate menu from the restaurant’s own. The restaurant makes the food and sends it out for delivery. Today’s press release notes that restaurants maintain about 40 percent of the revenue from each order, even when factoring in things like packaging costs and third-party delivery fees.
Wow Bao’s idea for the partner kitchen program actually predates the pandemic’s widespread presence in the U.S. However, the concept is an appropriate one right now, given the wreckage COVID-19 has brought to the restaurant industry in the form of dining room restrictions and lost sales.
The ghost kitchen and virtual restaurant concepts have, in general, proliferated over the last several months. But for restaurants that don’t have a ton of extra money to spend on a major lease with a more traditional commissary, an option such as Wow Bao’s partner kitchen is a promising alternative that doesn’t require a lot of physical space or operating costs.
Wow Bao said in today’s press release that these partner kitchens are especially successful in rural areas, where “food variety is more limited than in metropolitan areas.” Most restaurants, rural or otherwise, have surpassed the expected sales mark of $2,500 in six weeks.
A new partnership with digital marketplace Franklin Junction will add another 50 Wow Bao partner locations around the Northeast and Mid-Atlantic, while a nationwide expansion is expected to take place in the first half of 2021.
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