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The Uptake | Cloud kitchens: best of both worlds

Written by The Uptake Published on   2 mins read

Facing tough competition, virtual kitchens go click-and-mortar.

Hi, it’s Edmund.

The concept of cloud kitchens has been around for some time now. We’re talking about high-tech food production facilities without customer-facing operations.

But over the past few years, this space has gained traction, especially in Asia. In fact, the Asia Pacific is expected to be the largest cloud kitchen market, registering 14.4% annually from 2021-2027.

One of the main reasons why cloud kitchens do well is because they not only offer F&B businesses a way to test market readiness but also let them operate without bearing high operating costs, among other factors.

Despite its benefits, the cloud kitchen business is a highly competitive one. Southeast Asian “super app” and ride-hailing giant Grab announced in October that it will close its cloud kitchen service GrabKitchen in Indonesia after four years of operations amid efforts to adopt an “asset-light” business model.

Cloud kitchen operators and restaurateurs need to evolve to thrive in this increasingly crowded space. This is also why some cloud kitchens are testing new ideas in the food services industry. One such model is a ‘click-and-mortar’ strategy that combines online and offline operations.

For example, cloud kitchen unicorn Rebel Foods is experimenting with an offline food court in Mumbai, India, and exploring an omnichannel model for its cloud kitchen business.

Philippine “cloud restaurant” CloudEats, which first started as a cloud kitchen with digital-only food brands, is also looking at driving growth by creating physical dining spaces for consumers.

Check out our interview with the CloudEats’ co-founders here.


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