With the proliferation of internet infrastructure and services, Indonesia’s online food delivery market has flourished in the past three years.
As a result, cloud kitchens have found their place as well. By preparing and packaging food that is delivered to homes and offices—much like conventional caterers—these kitchens shed costs related to maintaining dine-in services. Indonesia-based Yummy Corp is one company that has been whipping up business by doing just that.
From catering to cloud kitchens
In 2016, Mario Suntanu was a general partner at venture capital firm SMDV, but he saw a shift in the food and beverages industry. “Restaurants would not survive if they only have offline services. They need to go online,” he said in a recent interview with KrASIA.
He decided to start a catering company called Yummy Corp with his brothers Marius and Marbio. Two of his friends, Edward Kumar and Juan Chene, also joined up, and they found backing from an Indonesian food and beverage (F&B) conglomerate, Ismaya Group. Yummy Corp’s early staff were part of Ismaya’s catering division, which gave the company a head start.
With its personnel in place, Yummy Corp was officially established in January 2017. “We started with corporate catering facility management, providing employees with high-quality food and saving time, as they no longer needed to travel outside looking for lunch,” Suntanu said. Yummy managed to sign notable clients, such as Unilever, Wings, and the United States Embassy in Jakarta.
Not long after, the company upgraded its catering service by launching Yummybox, where employees could customize their meals using an app and have them scheduled for delivery. At Yummy Corp’s peak, the company claimed to cook around 18,000 meals per day for its customers.
Months before the pandemic ripped through Indonesia, Yummy Corp went further to take on a larger stake in the F&B sector. In 2019, Yummy Corp acquired one of its competitors, Berrykitchen, then rolled out its cloud kitchen vertical, Yummykitchen.
“We want to help existing restaurants grow their business through cloud kitchens, where orders come mostly from online channels like food delivery platforms,” Suntanu said.
Unlike most cloud kitchens, which only provide space and equipment, Yummykitchen provides trained staff that handles food preparation and cooking as well. This way, brands can save on manpower and only need to prepare the ingredients for their menus. Yummykitchen deploys a revenue-sharing model, although Suntanu didn’t disclose the exact breakdown.
Before COVID-19 came to define much of 2020, Yummy Corp’s main income source was corporate catering services. Now, with a work from home policy that essentially suspended this branch of Yummy’s operations, Yummykitchen is the company’s backbone, generating 75% of the firm’s income, tripling its share as other streams wane during the pandemic.
“It grows rapidly. The revenue from cloud kitchen nowadays is much higher compared to the highest revenue from catering in normal periods,” Suntanu said. Yummykitchen now has 70 outlets in Jakarta, Bandung, and Medan. This count surpasses Grab’s 48 spots and Gojek’s 27, making Yummy Corp the largest network of cloud kitchens in Indonesia.
However, Yummykitchen faces tough competition in the cloud kitchen industry. GrabKitchen has been around since 2018, while Gojek has operated its Dapur Bersama (“public kitchen” in Indonesian) since July 2019. In fact, some of Yummykitchen’s locations are rented from Grab, another cloud kitchen startup Everplate Kitchens, and other independent players.
“We operate from their location. You can say that they provide the space while we are the operators. In this partnership, we use a revenue-sharing model. We’re also using their [Grab and Gojek’s] channels for orders and delivery service, so it’s more about complementing each other,” Suntanu said.
A tasty future for food orders
Yummy Corp recently raised USD 12 million in a Series B round led by SoftBank Ventures Asia, with an eye on opening more cloud kitchens in Indonesia’s major cities.
Using a prediction model, Suntanu has plans to reduce the serving time from ten minutes to a ceiling of three minutes—a tall order. “Usually the staff starts cooking after the order comes in. But with data analysis, we could predict the orders at a certain time and prepare them beforehand, so the drivers don’t have to wait long,” he said.
He believed that the habit of ordering food online will stick with customers even after the pandemic subsides, promising even more growth. “People are spending time at home, so they cook more. When they start going back to work in the office, they don’t have time to cook. So they will order more food,” Suntanu said, “It will not drastically decline, but steadily grow instead.”