Since March 2020, when a rapid change in the way we consume goods and services occurred due to pandemic-related confinement and safety measures, we have become acquainted with seemingly new business models. One of these is the concept of Dark Kitchens or ghost kitchens. The most common example of this model is ordering a pizza, where the system revolves around delivering food to homes without consuming it on-site. However, this concept has evolved over the years and encompasses much more than its original premise.

According to Michael Schaefer, Global Leader of Food and Beverages at Euromonitor, there are two types of businesses: dark kitchens and virtual restaurants. Dark kitchens exclusively produce food for delivery or takeout, without direct customer service, and can be operated by restaurants or third parties. On the other hand, virtual restaurants prepare food exclusively for delivery, without a physical location. They can either be dark kitchens or utilize existing restaurant kitchens.

The history of dark kitchens can be divided into four stages:

1.- The first stage began in 1998 when companies like Grubhub and Just Eat invited restaurants to join home delivery services.

2.- The second stage started in 2015 with the arrival of Uber Eats in the restaurant industry.

3.- The third stage, from 2015 to 2020, saw the emergence of the term Dark Kitchens or ghost kitchens.

4.- The fourth stage began with the pandemic and the circumstances of 2020, where innovation continued to flourish.

Dark kitchens naturally complement home delivery services. According to Euromonitor, Latin America and the Asia-Pacific region together represent 80% of independent food outlets worldwide, and food delivery services have experienced significant growth in the past five years. In 2020, the value of food delivery sales in Latin America reached approximately $35 billion USD. This growth in food delivery sales is not limited to Latin America but is a global trend. According to Schaefer, it is estimated that food delivery sales doubled worldwide from 2014 to 2019.

Based on data from the AMVO's "Study on Online Sales in Mexico - 2021," 44% of respondents made online food delivery purchases, a significant percentage compared to the 22% and 29% who made online food or grocery purchases, respectively. This establishes food delivery services as the preferred category among consumers by the end of 2020. So, what are the benefits of these ghost kitchens?

The most significant benefit is the reduction in occupied square meters, resulting in lower rental expenses. Additionally, sales utility increases as there is no need for capital investment in space, service, or tables. The initial investment required is much lower, making ghost kitchens a profitable business model.

With the onset of the pandemic and changes in consumer habits, dark kitchens have become indispensable not only for major restaurant chains but also for restaurants in general. They enable them to reach consumers at home and remain competitive in the market. Euromonitor reports that China has approximately 7,500 dark kitchens, India has 3,500, the United States has seen 1,500 emerge, and the United Kingdom has 750.

Restaurants have adapted their design, location, products, and marketing strategies accordingly. In Mexico, Alsea is an example of a company that has incorporated and adapted to Dark Kitchens. In their "COVID-19 Update" report, they announced the adaptation of 34 El Portón and Vips units to offer the services of brands such as Chili's, Italianni's, The Cheesecake Factory, La Casa del Comal, and Corazón de Barro in this format. According to research conducted by SiiLA Mexico, these converted stores amount to 12,070 square meters in the country's main markets.

In addition to popular food delivery platforms like Uber Eats, DiDi Food, and Rappi, new business formats have emerged to accommodate Dark Kitchens. Examples include Muncher and Virtual Kitchens, which have locations in various neighborhoods in Mexico City such as Polanco, Escandón, Roma, Condesa, Guadalupe Inn, Coyoacán, San Ángel, Nápoles, Pedregal, Insurgentes Sur, and Santa Fe. These formats provide entrepreneurs with a wide reach to their target audience.

It is projected that by 2030, Dark Kitchens could create a global opportunity value of one trillion dollars, according to Schaefer. This type of business has the potential to adapt spaces within shopping centers and apply the "prepare and deliver" model in traditional commercial locations, utilizing the available 71,000 square meters for mini-stores or food courts. Additionally, existing office spaces in key submarkets of cities could be repurposed, giving a new twist to these spaces and revitalizing the real estate sector in line with new consumption trends.

Stay up to date with the growth of Dark Kitchens and the behavior of the retail sector in Mexico at siila.com.mx.