by - Cloud Kitchen Market is Expected to be Flourished by Rising Demand for Convenience Foods
The cloud kitchen market refers to a centralized food preparation facility utilized by restaurants and food aggregators for food delivery and takeaway orders. In a cloud kitchen, food orders are fulfilled and then transported to customers using delivery executives. The model helps restaurants reduce their overhead costs by operating without any dining area and maintaining a smaller physical footprint for only food preparation, packaging, and delivery needs. It allows food entrepreneurs and chefs to launch new delivery-only brands without investing heavily in restaurant space. Furthermore, cloud kitchens act as shared commercial kitchen spaces that can be rented or leased by foodservice operators for their production and logistics needs.
The global cloud kitchen market is estimated to be valued at US$ 100.46 Bn in 2023 and is expected to exhibit a CAGR of 12. % over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Dynamics:
One of the major drivers fueling the growth of the cloud kitchen market is the rising demand for convenience foods. Rapid urbanization and busy lifestyles have increased the preference for ready to eat meals and on-demand food delivery services among many customers. However, operating a brick-and-mortar restaurant involves high rental costs, employee expenses, and maintenance that poses challenges in prepared food delivery. A cloud kitchen helps address these issues by operating out of a centrally-located shared commercial space, thereby reducing overheads significantly. This allows restaurants and food brands to focus more on food quality and expanding their reach through cloud kitchen partners. The flexible production models adopted by cloud kitchens also enable faster menu innovation and customized regional offerings based on demand patterns, further driving their popularity.
Segment Analysis
The cloud kitchen market is segmented into independent cloud kitchens and chain cloud kitchens. Independent cloud kitchens dominates the market and holds around 60% share owing to lower overhead costs and rental prices as compared to chain cloud kitchens. Independent cloud kitchens operate on a franchisee model, have lower seat up capability but offers flexible business models.
PEST Analysis
- Political: The cloud kitchen industry is regulated at state and local levels regarding licensing, safety standards and zoning. Some regions have enacted policies supportive of cloud kitchens to encourage food innovation and entrepreneurship.
- Economic: Growth in the number of nuclear families, dual-income households and preference for food delivery over dining out is driving the demand for cloud kitchens. The industry is also benefiting from rising investments to expand infrastructure and global expansion of major food delivery platforms.
Social: Changing lifestyles and busy schedules have increased the dependency on food delivery services. The COVID-19 pandemic further accelerated this trend and boosted the popularity of cloud - kitchens as they ensure easier access to affordable meals without risks of dining out.
Technological: Advanced technologies such as POS systems, online food aggregator platforms, AI and analytics are helping cloud kitchens in improving operational efficiency, menu innovation, order management and last-mile delivery. Digital marketing tools are also aiding customer acquisition.
Key Takeaways
The global cloud kitchen market is expected to witness high growth over the forecast period. North America dominates currently due to growing popularity of subscription meal kits, food delivery apps and demand for convenient cooking options. Key players like DoorDash, Kitchen United and Rebel Foods are expanding across the US to tap opportunities.
The Asia Pacific cloud kitchen market is poised to emerge as the fastest growing region till 2030 led by countries like India and China. With rising digital connectivity and online food delivery craze, startups like Dahmakan, Kitopi and Cloud Kitchens are quickly capturing market share in major cities.
Key players operating in the cloud kitchen market are Dahmakan, DoorDash, Ghost Kitchen Orlando, Keatz, Kitchen United, Kitopi Catering Services LLC, Rebel Foods, Starbucks Corporation, Swiggy, and Zuul. These players are focusing on expanding kitchen facilities, designing smart kitchen infrastructure, partnering with restaurant brands and ensuring seamless delivery experience. DoorDash and Kitchen United have established global presence while regional players like Rebel Foods and Dahmakan dominates domestic markets with their wide network of cloud kitchens across India.
