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Monthly Roundup: October 2019

Are ghost kitchens really the wave of the future, or are they too risky a bet?

The answer to that question seems to depend on whom you ask – and there’s evidence to support either argument – but, here’s what’s clear: tech companies and their investors are as willing as ever to take the gamble.

Over the last month, some of the biggest tech players in the food space — DoorDash, GrubHub, and UberEats – made announcements related to ghost kitchens, or “virtual restaurants.” It’s all part of a push not just to deliver food from restaurants, but to have a hand in the preparation of food for delivery. And, the competition for the customer’s delivery dollars is fierce.

To be sure, these facilities may present an opportunity for a struggling restaurant to try something new. Rarely talked about though, is what restaurants give up – ownership of data about their own customers.

That data tells restaurants everything from who their customers are to the all-important piece of information: their customers’ food preferences. When a restaurant serves a customer who ordered through an app, that data is captured, kept and controlled by the company that provides the app. Adding tech-owned virtual restaurants to the mix is likely to expand the amount of data managed by the apps and only available to restaurants through those third-party companies.

A little more than a week ago, we shared a link here in The Daily Prep to The rise of ‘ghost kitchens’: Here’s what the online food ordering boom has produced. That story, published in USA Today, detailed the fact that restaurants who don’t do well with one concept or another are turning to tech to find out, what would do well? Then, it’s UberEats or Grubhub letting the restaurant know that in a particular area, there is, for example, a demand for burgers.

That may sound convenient – like tech could make a good partner for restaurants – but it begs the question, shouldn’t restaurants develop their own virtual kitchens in the same way that some are turning away from third-party delivery? That way, they’re not relying on a middle man for data, for kitchen space, and for the most important ingredient in doing business – access to the customer.

Food for thought.

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The Daily Prep Team

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