July 13, 2024
Cloud Kitchen Market

Cloud Kitchen Market is Estimated To Witness High Growth Owing To Trends in On-Demand Food Delivery and Cloud Kitchens

The Cloud Kitchen Market is estimated to be valued at US$ 44.28 Bn in 2023 and is expected to exhibit a US$ 44.28 Bnover the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market Overview:
Cloud kitchen, also known as a virtual kitchen, ghost kitchen or dark kitchen refers to a commercial space equipped for the preparation of food that is delivered to customers but has no storefront or seating area. These kitchens are specifically designed for food delivery services and on-demand food or take-out orders. The main advantages of cloud kitchens are lower rental costs, optimized space & infrastructure for delivery-only model, and ability to cater to multiple virtual brands from the same kitchen.

Market key trends:
One of the major market trends in the cloud kitchen market is the rise of on-demand food delivery services. The emergence and rapid growth of online food delivery platforms has led to increasing demand for cloud kitchens that can serve multiple virtual restaurant brands on these platforms. Various major delivery platforms are investing in setting up their own cloud kitchen facilities that can deliver multiple cuisines and menus to their customer base. The ease and efficiency of online ordering and delivery of food is driving more customers to opt for on-demand delivery, therefore fueling demand for cloud kitchens. This trend is expected to continue during the forecast period.

Porter’s Analysis
Threat of new entrants: The Cloud Kitchen Market Growth has moderate barriers to entry as significant capital is required to setup a commercial kitchen and acquire necessary licenses and approvals. However, operating costs are relatively low.
Bargaining power of buyers: Buyers have moderate bargaining power as there are numerous cloud kitchen operators providing substitutable services. However, brand loyalty provides some customer retention.
Bargaining power of suppliers: Suppliers have low bargaining power given the fragmented nature of ingredients, packaging and logistics suppliers in the cloud kitchen ecosystem. Operators can easily switch suppliers.
Threat of new substitutes: The threat is moderate as new business models like restaurant aggregators are emerging as substitutes. However, high setup costs discourage frequent enterprise.
Competitive rivalry: Intense as operators compete on factors like menus, delivery time, quality, pricing and technology.

SWOT Analysis
Strengths: Target niche cuisines, leverage delivery networks, optimize real estate costs, access to analytics platforms, faster scalability.
Weaknesses: Brand recognition, reliance on third parties, difficulty in standardizing quality, managing disruptions.
Opportunities: Untapped international markets, expanding product portfolios, tie-ups with quick service brands, leveraging 5G and AI.
Threats: Supply chain disruptions, dependency on logistics platforms, regulations around commercial kitchens, price wars.

Key Takeaways
The global cloud kitchen market is expected to witness high growth, exhibiting US$ 44.28 Bnover the forecast period, due to increasing online food orders and demand for convenience foods. The Asia Pacific region dominates the global cloud kitchen market and is projected to grow at fastest pace due to rising number of internet users, tech adoption and young demographics in countries like India and Indonesia.

Regional analysis
The Asia Pacific cloud kitchen market is projected to grow at fastest rate owing to growing popularity of online food delivery platforms. Countries like India and Indonesia account for over 50% share of the region’s market. Major operators in Asia are expanding aggressively through mergers, partnerships and new launches to tap burgeoning demand in tier-2 and tier-3 cities.

Key players
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. Companies are investing in R&D, virtual restaurants and last mile delivery fleets to enhance customer experience and gain higher market share.

*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it