"Among the Big Chickens" | spooky kitchens #24

Happy Friday y’all,

First thing’s first: Issue 24 on the 24th! It’s a sign. Bet on 24 today. Don’t know 24 what, but bet on 24.*

Also FYI, you can read this on the web, with slightly better aesthetics than your inbox.

And just a quick reminder: all green text is linked.* (*not always to anything important)

So what happened this week? (TL;DR)

• First, we take a gander at 6 new(ish) ghost kitchen concepts.

• Also, 20% of big chains shrank but grew, ultra-fast delivery’s latest lesson, and Shaq’s Big Chicken.

Now fire ghost kitchen-ish concepts!

6 ghost kitchens walk into a bar *all frantically hoping the others are going to pay*

“6 ghost-kitchen startups bringing new business models to the multibillion-dollar segment” Nancy Luna, Insider.

There’s a lot of useful detail on each of the six ghost kitchen (or ghost kitchen-tangent) companies’ operations, history, and differentiation inside the article — I suggest checking back in here after you’ve perused it. The following are just my own quick and unadulterated thoughts on this new-ish crop of ghost kitchen-ish businesses:

• Hungry House: Things appear to be on-the-rails for Hungry House; which is as close to a “resounding success” as there is in this industry. The self-labeled “anti-ghost kitchen” began with the intent to bring creative menus specially crafted for pickup & delivery by local makers & restaurateurs to its New York service area, and…it has. Hungry House is a little bit C3 with their multiple in-house brands and on-trend aesthetic (sorry — to clarify, C3’s aesthetic is not on-trend, but it is an aesthetic), and a little bit Nextbite or VKC with their co-developed influencer concepts, but on a hyper-local level. Sounds pretty great. HH is still young, so I’m waiting for the other shoe to drop, but I’m rooting for them. Local food beats So-and-So’s Wings ‘N Things any day.

• Combo Kitchen: Still want a Zombocom Kitchen, and I’ll never not think of that when I read “Combo Kitchen.” Anyway, Combo Kitchen is a middleman firm, connecting restaurants with capacity to spare to brands that have…brand…to sell. Not necessarily good brand, but, you know, brand. Its best-known partner is Saladworks — though Saladworks will partner with just about anyone with 4 walls and a roof nowadays.

• One Stop Kitchen: Combo Kitchen but make it local. OSK matches local restaurants with other local restaurants to create local virtual food halls. There’s no licensing or franchising involved, which serves as an illustration of how the concept is more about the menus than the brands. I still don’t know that I love the idea of single kitchens rendering extremely divergent menus — the quality of execution depends highly on the team in each individual kitchen, and it seems like it would require a lot of ordering new or atypical ingredients and supplies for the host restaurant — but I won’t fully knock it until I fully try it. In any case, 14 locations is no joke.

• Franklin Junction: Franklin Junction is the oldy of the group and yet another matchmaker, having been putting restaurant and hotel kitchens together with other restaurants’ brands and menus for two solid years. Having talked about One Stop and Combo already, there’s not much more to say about what they do, and little that’s different; Franklin just has better (or at least, better-known) brands. Also, TBH, trademarking the phrase “Host Kitchen” is a real self-important groaner of a move.

• Wonder: I dug into Wonder last week. TL;DR: still don’t get it. But I don’t have to. Because a few good ol’ boys with 9 figures to spare apparently get it just fine.

• BLT Kitchens: This is a commercial kitchen in the Phoenix area that also allows its tenants to operate as a ghost kitchen (in addition whatever else the caterers, food trucks, and other makers that have always relied on these facilities usually do). Typically this is not the best setup for a ghost kitchen, as larger commercial kitchen facilities are often located well outside of strong takeout & delivery trade areas — and according to the map, that seems to hold true for BLT’s Mesa & Phoenix locations (the Phoenix one is also located right next to a mountain, an impassable obstacle that would further diminish the location’s reach). Then again, you can drive a long way in 15 minutes in AZ, so, *shrug.*

🧂️ Saltalk may be doing something different in the bay…or not? (“Saltalk turns up the heat on its virtual kitchen following $8M cash infusion” Christine Hall, TechCrunch). This may as well be an addendum to the above. Saltalk, a Bay Area ghost kitchen startup, does things a little differently, opening up its kitchens to restaurants to rent (or lease) and delivering bundled orders with items from any of its restaurants; just not on-demand. All orders are delivered in specific windows throughout the day, or multiple days in advance, via their own couriers. The focus here is less on instantaneous fulfillment than it is big, grouped orders, whether for home (like a meal plan, of sorts) or for the office. This style of operation is typically a bit easier on the restaurants (as all orders should have plenty of advance warning), but faces an uphill challenge garnering consumer attention away from the massive on-demand-delivery marketplaces. The food selection aims to both satisfy and help alleviate the homesickness of Bay Area immigrants & diaspora.

• Related: India’s Kytchens raises $800K to expand. Kytchens offers its food & restaurant partners a full suite of services (including cooking). It joins the ranks of contenders (such as Curefoods) to country powerhouses Rebel Foods & Swiggy.

😮 Woah! I opened up more channels to order food and more people ordered! (“The most successful restaurants last year grew their omnichannel technology, not their portfolio” Joanna Fantozzi, NRN). Data from Datasseential “showed that nearly one-fifth of restaurant chains grew their AUVs in 2021 — many by double-digit percentages —while their store counts simultaneously shrank or stagnated.” Taking the time to not only open up new ordering channels to a restaurant, but to make sure they actually work optimally to yield both a meaningful result for the business and quality experience for the customer, turns out to be a worthy investment. 20% of NRN’s Top 500 restaurant chains shrinking unit count while increasing AUV is a significant stat. For most large chains (and for most publications that track these things), the two statistics typically go hand in hand in a positive relationship that obviously illustrates the success of a restaurant business. But if I’m someone keeping an eye on restaurants with the traits of durability & future success, I’m looking closely at these 20% that break that mold.

🤒 What holds the future of (ultra-fast) delivery? (“Nobody wants to pay for ultra-fast delivery” Michelle Chang, Quartz). While this article focuses on the 15 min-or-less grocery delivery startups that have had a bumpy road of late (and likely a bumpier road ahead), the ramifications it presents certainly also apply to delivery in general; will VCs continue to bankroll service-oriented companies that have been (literal) losers since the beginning? Luckily for DoorDash, Uber Eats, and Grubhub, they’ve been around for a minute, diversified their services (some more than others, Grubhub 👀), and generally should have the means to withstand some bumps, bounces, and jostles from the market. The quick-grocery startups, on the other hand, had probably planned on continued support and exultation from the VC club, who are always looking for opportunities, but nowadays with a slightly more cynical gaze (that is, when they aren’t celebrating watching the downfall of crypto, live). For ghost kitchens, this may mean higher prices for all kinds of delivery as providers reprioritize financial health over market share, likely eliminating various consumer subsidies along the way.

🐔 Shaq’s Big Chicken (“Shaquille O’Neal to open chicken restaurants in North Texas” Sarah Blaskovich, Dallas Morning News). Honestly the best part about this story isn’t even real. Thanks to the brief page description on Google, I thought the name of the restaurant was “Among the Big Chickens,” which I thought was probably the single greatest restaurant name I’d ever heard. Alas, it’s not. “Big Chicken” ain’t bad, though. Anyways, it’s a ghost kitchen and there will be 50-ish locations. All hail the unstoppable Shaq.

• Related: “Nextbite partners with Wiz Khalifa on new virtual brand” Release, QSR Magazine. 🙄

🥪 Dessert: Sandwiches of History. The most wholesome food-stagram you will ever follow. For a taste, watch his most recent Onion Sandwich video (stick around for the bloopers).

📉 Double Dessert: NPR on recessions.

That’s spooky kitchens.

Boo ✌️,

Mitch

P.S. If you’re just jumping into ghost kitchens and want to learn more, check out my ghostly glossary and spooky kitchens ghost kitchen cheat sheet. They’re there to help make sense of this weird and wild west.

*Not responsible for any adverse results from “betting on 24.”