FSSAI Food License

All you need to know about starting a Cloud Kitchen Business in India

In this article we are highlighting about starting a cloud kitchen business in India, which is the latest food business. It is incorporated under FSSAI Registration. A cloud kitchen business is a service which is in a virtual form. They have a base kitchen where they deliver the food to the customer at their doorstep.

A cloud kitchen is recognised as the dark kitchen or ghost kitchen^[1], or it is a virtual restaurant, a restaurant service with no dine-in facility. The cloud kitchen takes orders online or by telephone. Their business is dependent on online food aggregators such as Swiggy, Zomato, Uber Eats, or any other websites or mobile applications.

Significance of Cloud Kitchen Business

1. They are restaurants without any physical presence.
2. Customer orders food from the online menu and food reaches them through delivery agents.
3. The cost of the setting a cloud kitchen business is not that much. The cost is minimal when compared to setting up of the traditional food restaurant.
4. The food technology industry has seen the overall GVM growth of 140% in 2019-2020. Where the number of orders has been increasing to 176%.
5. Food aggregators such as – Uber Eats, Zomato and Swiggy provide end to end services to cloud kitchen businesses.

Case study of Rebel

It is a nine-year-old company / a start-up in India, which has tie-up with food delivery brands like Zomato, Swiggy. Rebel is an online restaurant company. Food is delivered through the use of internet.

The above heading needs no introduction that we are discussing the article that is a case study of Rebel. The success of Rebel is known to the public. The business is all about, where the food entrepreneur runs the food kitchen from his home and the food aggregator/mediator like Zomato would deliver food to customers.

Aim of the Company

Rebel aimed that by creating a cloud kitchen business they were omitting the location dependency, which primarily helped food operators to open their business in a pandemic.

The success of the Company in the Cloud Kitchen Business

Rebel foods are one of the largest cloud kitchen businesses distributed in 35 cities in India. The Company owns, 2200 restaurants in 350 locations pan India, and 301 cloud kitchens across the country. Currently, the company works with 10,000 individuals and is one of the fastest growing cloud kitchen businesses in India.

Working of the Company in the online kitchen business

1. The Company works in a pattern of not building a single brand but believed in making a multi-cuisine restaurant at one place with multiple brands together.
2. The failure of any food business is due to the location. The location of the business can make you rise or float or remove you from the market.
3. The company changed the concept by building brands in the food industry only through the internet.  The Company opened an online kitchen business such as Behrouz Biryani.
4. Where the customers were targeted in and around the kitchen were targeted and through third-party platforms.
5. Where they made the shift from a single kitchen model to the multi-brand and multi-purpose kitchen model.
6. They have built online kitchen businesses such as Behrouz Biryani and Oven Story.  Rebel foods became the parent brand for the current and future online restaurant brands/ online kitchen business.

Advantages of Online Kitchen Business

The following are the advantages of Online Kitchen Business

1. Low Investment Model

The cost of setting up a cloud business model is significantly meagre when compared to the traditional food joint venture. It is considered to be a high business model.

2. Food delivery a new mode

The online kitchen business can be connected through the internet to food aggregators.

3. High Operational Efficiency

Since it is a low capital expenditure business, it indicates to be of high profit opportunity. It has low indirect cost. It attracts the customers who are budget friendly as no extra cost will be added on their head like service charges.

4. Online Food Aggregators

The online food aggregators or mediators play a vital role in his success. The online kitchen business grew, eventually because of food delivery partners. Ultimately, the success of the food joint venture is dependent on the customer. The customer if getting food online through these outsourced food delivery partners adds to the success of Online Kitchen Business.

5. No seating cost

It outlines the cost of seating like a fine dining restaurant has to do. This cost is done away when the online kitchen business is started as the concept is no fine dining.

Types of online cloud Kitchen Business Models

1. Single Cloud Kitchen

The working of cloud kitchen business is on a simple food menu and keeping only 10-15 food items.

2. Virtual Restaurant

This restaurant serves food exclusively by delivery. As the restaurant is a virtual restaurant.

3. Multi Brand

The different brand name restaurants are working under one roof.

4. Aggregator/Mediator based cloud kitchen

The working of the business is dependent wholly on the food delivery partners like Swiggy or Zomato.

5. Creates Co-working Space

It is called a kitchen space where the multiple brands can come together at one common place with different kitchen units.

Role of FSSAI Registration

The critical part of starting the cloud kitchen business is to undertake the FSSAI license to avoid the legal complications. The license gives the assurance to the customer that the food is prepared under proper hygiene and sanitation is appropriately followed, and guidelines of FSSAI are regularly inspected.

Conclusion

The growth of the food business is dependent upon the customers and the quality which is served. In every aspect, the cloud kitchen business is an innovative concept or a new business platform. This can be said that it saves them money which is to be spent on rent if any premises are rented; as a result of this, it reduces the cost for the entrepreneurs. The FSSAI registration is checking whether the requirements are met by the business. This keeps the satisfaction of customers, as the business has no physical outlet in India. However, on the positive side, the business is not dependent on the location for its success now. Also, the pandemic has taught we need to digitalise in our working style.

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