An Inside Look at CloudKitchens | Hacker News Reader

An Inside Look at CloudKitchens

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I’m pretty bullish on this concept finding market fit, probably less confident about the business model being great. The super interesting feature IMO is how much this lowers the cost to enter the market. I imagine this are super short term leases (maybe...per shift?), no need for POS, simple bulk ordering etc. shifting capex to opex for small businesses will open up the market to a lot of new entrants. I think a comparison to AWS is fair here.

On the financial side, it sort of seems like a race to the bottom for the landlords. I don’t think they’ll have anything like the lock-in AWS has and given how significant the expense will be I would imagine teams being pretty willing to jump for a small savings (which goes to straight to the bottom line). IMO this would be a great move by one of the apps to own, as controlling distribution would lock tenants in.

+1 I think this is the infra revolution we need.

It makes sense but I don't see the benefit of Deliveroo type companies operating them. Better results would come out of a more organic approach.

It would be a great way to diversify the offerings for people who want to start a small restaurant.

A lot of cities don't have certain types of cuisines. This could be an option for a new immigrant to introduce their food to a new market.

And for those who see a bigger picture, renting these ghost kitchens to new immigrants on a Kitchen-as-a-Service model.

I'm bullish on the concept and business model from an investment standpoint, I think they are likely going to become very successful, but as a consumer I can't say I'm looking forward to delivery platforms being flooded with these "cloud kitchens".

It seems to be designed to enable mediocre restaurants to "pivot" at a moment's notice and rebrand themselves after building up a well-deserved crappy reputation, ready to start anew and fool more unsuspecting consumers. On the other side of the coin, well-loved restaurants could disappear at a moments notice because the owner/chef got tired of making the same type of cuisine and want to experiment with something new or more lucrative/trendy.

I think the agility this model offers restaurants is both a blessing and a curse in this sense, as with traditional restaurants the physical presence involved makes the brand more enduring, for better or worse.

>> well-loved restaurants could disappear at a moments notice because the owner/chef got tired of making the same type of cuisine and want to experiment with something new

So let's say you're such an owner. Just sell your business, and start something new.

But this could make things really interesting: What if you could order any meal you read about on the web, from anywhere ?

It's not possible for every dish, for the lack of local ingredients. But maybe it's possible for many dishes ?

A robotic ingredient picker could be really useful in that context. Make a large kitchen with a ton of ingredients. When an order comes up, a robot picker automatically brings the sauce ingredients to the saucier, the sautee ingredients to the sautee station, etc...

> n the other side of the coin, well-loved restaurants could disappear at a moments notice because the owner/chef got tired of making the same type of cuisine and want to experiment with something new or more lucrative/trendy.

If you watch the restaurants that are successful, you will notice it does not happen. It may spell "the owner/chef got tired of making the same type of cuisine" but it reads "the owner/chef was not making enough money"

Aggregating many restaurateurs at a single kitchen, and encouraging families to order from that kitchen, a bundle of meals, could save significant money on delivery.

And landlords could also offer their own delivery app, for more savings.

For a restaurant brand owner, leaving that kitchen means leaving those bundles and customers. And replacing him(for many customers), is a possibility.

That's one way landlords could gain some lock-in.

Also, even without significant lock-in, landlords that may have many kitchens, could have significant purchasing power of food ingredients. Even if they earn only a single digit percentage on that, food ingredients have rapid turnover, so yearly ROIC is significant.

For those that haven't been following this, CloudKitchens[0] is a still somewhat stealth "startup". It was started by Travis Kalanick (of Uber fame) and he has been doing a fairly good job keeping it hidden[1].

[0] https://www.cloudkitchens.com/

[1] https://www.ft.com/content/769409f1-fb0b-4761-b2aa-e75b9792c...

Here's hoping they can keep the culture from being as toxic as Uber's was under his tenure.

Fwiw, the guy who wrote this article is ex-Uber and was involved in Policy and Strategy for Uber India. Probably has privileged access to Kalanick’s new venture.

Wonder if one part of their secret sauce will be skirting health code.

Do you mean the kitchen skirting codes or the tenants?

I don't know that much about health codes, but my guess is that they are not expensive to follow beyond the cost of having suitable equipment, which is something they probably won't be able to avoid.

Health codes in saner municipalities which are the municipalities occupied with people that have the most disposable income are extremely expensive to follow as they dictate enormous number of variables, ranging from what can be stored and how to what kind of cooking process one must follow.

For example, AC banned partially pre-cooking of poultry around 2012(?) at which point Revel's restaurant had to can its most ordered and one of the most profitable dishes as its guests were not interested in waiting for nearly an hour for a chicken to be cooked from scratch. They used to partially cook it, stick it into the fridge, wait for the order and finish cooking it in ~15-20 minutes. It was a total disaster for the restaurant.

Interesting re-framing of this sort of operation as 'Dark Kitchens' which facilitate worker abuse in this discussion on Trashfuture:

https://www.podbean.com/media/share/pb-iaxgv-e4084a?utm_camp...

It's a company that has raised hundreds of millions of dollars, has a known name, known business model and has had articles written about it. Not sure how anyone can consider it "stealth".

Rent is typically only 7% of total restaurant operations costs. See Chipotle's quarterly earnings filings for example, and any restaurant industry analyses.

Labor and food costs make up 60% of costs, with them being roughly equally divided. Restaurant margins are around 5-7%. I don't see how CloudKitchens is supposed to fundamentally alter the restaurant industry, making it cheaper. Maybe I'm missing something.

And if these kinds of kitchens really catch on I can see existing restaurant owners running more than one brand out of their kitchen to try and reduce downtime. Chuck-e-cheese and Chilies are already trying this.

One of the biggest problems of a kitchen is having food go bad. Nightly we have to throw away food because we don’t have another purpose for it. When serving a singular cuisine it is tough to find ways to create new dishes that fit into the menu. Ghost kitchens become interesting because assuming you’re running 3-10 “restaurants” out of the space, the overlap in ingredients becomes large which allows us to reuse and repurpose ingredients easily. This plus the volume of orders allows us again to reduce overhead costs of purchasing. Often times, it takes the same amount of effort to cook for 50 covers vs 500 but clearly the latter yields more profit.

I can't find any information on how inventory management works to see that kitchen waste would be improved.

I see two options:

1) Common inventory, in which case I risk running out of ingredients I need for my kitchen, or the inventory of the facility still has to overstock.

2) I can have my inventory delivered, which still means I have waste to produced.

And if I want to support local farms, is that an option, or is all of my food coming from US Foods/Syscon/etc?

I'd like to see a willingness for restaurants to say "I'm sorry, but we are out of that this evening." This would help eliminate food waste by not having to make a batch of something for only 1-2 customers.

Some restaurants do. I've certainly run into exactly that response on a number of occasions.

I know that in NYC a number of restaurants I liked have gone out of business because they couldn't handle the increasing cost of rent as building owners look at how much place like Apple are willing to pay for prime shopping locations.

Extremely dense areas like NYC are places where this seems like it might actually be the most cost effective not only because the high cost of rent but because you could have multiple kitchens to reduce the distance delivery drivers have to travel...and these kitchens wouldn't need to be in the prime shopping locations.

But I doubt it is going to be as big of a benefit in places like Oklahoma City, Omaha, Houston, etc.

This is true and has been going for most of the recovery post 2010.

However with the pandemic and a significant amount of people moving out of the city, coupled with retail closures and bankruptcies hopefully this rent gouging will come to a natural end.

The NYC real estate market is going to shed quite a substantial amount of value over the next 3-5 years and very likely prices will drop considerably. Perhaps 30-50% especially at the high end. The lower end will be a bit insulated because of demand and also because the prices there haven't seen as much of a run-up as the higher end apartments.

CloudKitchens could help reducing labor costs too.

Many of the restaurants that can go delivery only already did, like pizza places and some Chinese restaurants. But the problem is two fold, many food items don’t lend themselves to delivery, and then delivery itself is expensive and doesn’t scale either.

A large part of the restaurant experience is dining in, even if that doesn’t include the hospitality, the freshly prepared food will be irreplaceable. The moment it’s packed in boxes a lot of the food loses its edge and items prepared by many chefs will all seem similar. If this concept takes it will take the quality of food down globally.

However I am highly skeptical about it and the main reason is delivery, which I still think is a fundamentally unviable business.

I see your point and agree, for the best food you will want to go and find a table near the kitchen. However much of the market doesn't prioritize the best food as highly as convenience. They will happily order for delivery and get food of a somewhat lower quality for the added convenience. Even if delivery is more expensive than managing dine-in customers they will be willing to pay for that convenience

For example I often have friends over and it often makes more sense to order in than busy myself with cooking or traveling to a restaurant and coming back to continue our game/karaoke/whatever.

I think there is a large market and various points along the quality/price/convenience tradeoff have the ability to be profitable. There will probably always be a market for fine-dining and always be a market for delivery. There will also be a market for various points in between.

Maybe after not paying high street retail rent and wait staff salaries, margins go high enough to allow delivery, and don't forget the workday lunch market, which is more about convenience and sustenance.

The problem I have with arguments that are bearish on food delivery is that they are all focused on supply-chain challenges and ignore the obvious massive demand for the product. Of all the problems you can have in business, the only one that cannot be overcome is a lack of demand.

Widespread 1-day delivery of retail goods would have seemed totally absurd and unscalable just 20 years ago ("What, are we gonna FedEx overnight everything? Ridiculous!") and yet here we are. When there is demand, supply will rise to meet it almost every time.

Someone will figure out the logistics to make this work and become the Amazon of food (perhaps Amazon?).

Well theoretically you are right but practically speaking even amazon couldn’t really change distance. The whole allure of shipping things from a warehouse and not paying rent is true but at the end of the day amazon ended up setting warehouses all over the country to meet the demand for same day delivery. So it did reduce the real estate costs but it’s still has to stock all items close to the customer. So the efficiency is in cutting display and showroom costs. Food doesn’t fall under that category as it’s very different even from perishable grocery items. That is the source of skepticism. I agree there is demand but it only means that the business will never die, doesn’t mean that it’s going to overhaul the industry. Let’s see though. I do hope some innovative idea comes along.

At some point in my life I became extremely fussy about wanting to know where my food came from — particularly the meat — and the conditions under which all of it was produced. Vegetables, cereals, meat, dairy, the lot.

No more spring onions from farms employing exploited labour. Certainly nothing imported from countries without labour regulations or farming standards. No more indoor only “free range” chicken etc.

I’ve met the cows I eat and the hipsters who grow my cabbage. Both are very pleasant and show no signs of duress. All my suppliers have first names and Instagram accounts. There’s lots of evidence, alongside the produce itself, to cross reference their credentials. The market exists for more expensive, more carefully reared and more kindly cultivated produce of all kinds.

I trust only a handful of restaurants to get these details right and have had to accept that eating out is even more of a luxury than it used to be. None of the trusted restaurants are the local ghost kitchens, nor are they likely to be. Competing on price and efficient goes completely against the, ahem, grain.

I don’t want food to be cheap, fast, or efficient, and rarely — if ever — to be prepared by strangers I will never meet.

> I don’t want food to be cheap, fast, or efficient, and rarely — if ever — to be prepared by strangers I will never meet.

This is a mode of existence available to only the extremely privileged. It's a great luxury to be this picky about what you eat.

It might feel like a privilege to those stuck in a major metropolis.

Out here in a fairly rural second tier city, it’s a way of life.

(Though perhaps my privilege is that I can “afford” to live away from a major population centre? I’m a high school teacher. Demand for my skills is spread more widely than most tech jobs.)

This is an amazing level of privilege to the point that it almost seems like Silicon Valley parody. I completely agree with the aim (animal welfare, fair wages), but just want to note that 99.9999% of the population don't have the means (money, time, local availability, etc.) to live this way.

This is indeed a sketch from Portlandia.

https://www.youtube.com/watch?v=G__PVLB8Nm4

I disagree that I am privileged to have access to the fat of the land, but if you want to talk privilege then remember this in the context of:

1/ paying someone else to cook for you

2/ paying another person to deliver this food to you

3/ funding a fleet of SWEs and marketers to run the whole thing for you, by paying a double digit surcharge over what you might have paid if you’d gone to the restaurant in person.

I would say that the privileged are those funding the Seamless / Deliveroo serfs. I can’t afford to.

Maybe things are different in the UK, but in the US the only people with the time and money to be as choosy as you seem to be are the very privileged. Millions of people barely have their heads above water and they'll take the most efficient (in terms of time and money) calories they can get. Having the time to do the kinds of vetting you seem to do is a privilege itself. I hope the day comes where everyone has the means to be this conscious of their food, however, as I agree with your motivations (at least insofar as I understand them in an online post :P).

Ironically, aren’t jobs like ghost kitchen line cook and gig economy delivery rider behind the lowering of the quality of life for the “have-nots“?

All this while, at the same time, the “haves” continue to order their brunch using Colins-Organic-Chicken.app.

This sounds almost cut and paste from an episode of Portlandia.

While the intention is commendable, as other point out, it's so (sadly) far out of reach for the vast majority of the populace. Under current wealth distributions this will never even be approximately reasonable to expect or carry out.

OTOH, i would eat your high horse

When did you last visit a farm?

Maybe a farm-to-table joint in SoHo, Soho, or SoMa makes things seem glamorous. The prices probably do.

In rural England, raising livestock and growing food is so run of the mill it’s incredible to think it’s some kind of privilege to have access to primary sources of food.

It’s not even expensive. You just have to not live in the/a Metropolis.

I grew up in a rural place. A lot of our food is from relatives and from our own animals and plants. None of them are hipsters though, nor do they have instagram accounts. We don't apply the same standards to commercial food or when dining out: i know it would be incredibly taxing for the environment if commercial food did not exist. I just hope food technology improves so that we can replicate good quality in high quantities. I don't think organic can scale, nor would i support trying it.

Thank you for the followup; an interesting read.

For me, a positive trend I’ve seen over the past few years is a growing number of young people moving back to the countryside and either directly into agriculture / agribusiness / “ag”, or to doing supporting jobs in agriculture towns.

Commercial farming in the UK has always been an above average social category. The days of the farmstead are almost done, whereas the barley barons — or at least the social class closer to that end of the income spectrum — are on the up.

(If you know The Archers, think Brian Aldridge vs Pip Archer vs Eddie Grundy.)

Like a billion other people, they all post about it on Instagram. It’s surprisingly common.

"It will soon be just as cheap to have your food prepared and delivered as going to the grocery store and making it yourself."

I doubt this very much.

It is possible, but for bad reasons: food won't become that cheap in isolation, but in conjunction with the marginal cost of taking the time to cook being greater.

If you are an anxious overachieving professional, the above is probably already true and you survive off fast casual.

If you live in a food desert working 3 part time jobs, the above is probably already true and you survive off convenience store non-perishables and fast food.

You mean if you factor in your time? Okay: in that case maybe.

I can't comment on the actual subject at hand (I haven't read the article yet nor really done any research on this), but you absolutely have to factor in your time.

I like to cook. If my home situation was a little bit different, I'd probably cook full proper meals every night, no questions asked. It would take me at minimum an hour each night, and often more when you include prep and cleaning (which you should, they're integral parts of cooking a meal).

Combine that with long hours at work and the fact that I like to at least get some leisure time in my day along with sleep, and those hours add up. I've actually taken to eating mostly frozen food (stuff that still requires a little prep, not TV dinners, mind you), because it's a little faster and the cleanup is easier(stick some frozen chicken on foil in the oven and the cleanup is "throw the foil away"). When I don't do that, I'm meal-prepping on sunday afternoons, which takes four or more hours out of my precious weekend (with the exchange of being able to just microwave whatever I'm eating for lunch and dinner that week, again saving time).

Yes, where I live, groceries cost far less than anything you can get at a restaurant. And I'm hesitant to say that this will go anywhere, because it really seems like a long shot. But if it does get somewhere...the dollar cost of groceries is not the only thing to focus on. Time spent making meals absolutely matters.

Time spent making meals is a dead time. Those that do not consider that to be a dead time simply buy instapots, slow cookers and rice cookers.

I tell my work mates I spend probably 8+ hours in the kitchen during the weekend doing meal prep and they are some combination of aghast and disbelieving. Yes, 8+ if you want to eat decent, we're not being fancy. You can't just get groceries and come home to stuff them in the fridge. They need to be semi-prepped: unwrapped, minor cleaning, portioning out. Herbs and greens need to be washed and stored properly or they'll spoil. Want good soup? Have to break down the chicken to make stock, defat and freeze it. There's also the planning aspect, if you wake up on Saturday and start the grocery list, it's too late. I like to say "I like cooking", but most of cooking is drudgery: peel carrots, potatoes, break down chicken, trim the meat, manage food portion and storage. It's a huge time suck and if I factor in the cost of my time it's exorbitant. Having said all that, there is no reasonable alternative for me, right now. Everything else is garbage or unpalatable or exorbitant, and I still have to do supplemental cooking. I'm resigned to the fact that cooking, eating, cleaning, laundry is all part of living and I can't pay for all of it to go away. I'm trying to be a better planner, and chop and peel faster.

> I like to say "I like cooking", but most of cooking is drudgery: peel carrots, potatoes, break down chicken, trim the meat, manage food portion and storage.

Totally. I love cooking. But when I say I love cooking, I mean I love standing over a pot or pan, stirring, tasting, seasoning, and sauteing. Prep work is the worst part, and also often the part that takes the longest.

I love prep work! Cutting down a whole chicken.... chopping, prepping the mise en place. I find it really relaxing. :) seriously. Love the cooking part also too... what I hate is the dishwashing!

Sounds like we need to room together. I don't mind the dishwashing, either (assuming I do it when I'm supposed to; that is, not letting stuff sit and get chunks dried on......YOU HEAR ME, CURRENT ROOMMATES? NO, LEAVING STUFF SIT FOR AN ENTIRE WEEK IS NOT NORMAL).

> If you are an anxious overachieving professional, the above is probably already true and you survive off fast casual.

Is this the case where you live?

In my country, daily restaurant eating is less a sign of success, and more a sign of not knowing how to cook, which is a source of embarrassment for most overachieving professionals.

In NYC at least there is certainly a subset of ambitious professional types who derive some kind of pride at being incompetent at everything other than their job. I think it's humblebrag type thing where they show off a) how overworked they are all the time, which is a perverse status symbol here b) how they can afford to pay someone to do everything in their lives for them.

You can even rent an apartment here that doesn't have a kitchen.

This has already been true for a long time in high cost of living places like Manhattan, where groceries can be expensive and time is at a premium. It was certainly the case for me for years.

I found this to be true before having kids. The waste was so high it pushed the cost up for groceries. After increasing the number of mouths I find delivery to be much higher.

That's simply not true. Even if one buys all his or her ingredients at bodegas he will still beat the prices of the delivered food, not to mention that the cheap delivery food is basically low quality junk food.

I too doubt it will be as cheap, but scale and other related (but not accounted for) costs could make it similar. For example time spent cooking, grocery shopping, gas (cooking + fuel*), etc.

One major expense for a restaurant is rental costs for a dine-in area. These don't apply to cloud kitchens. More so, the cloud kitchens are not in a very popular high-rent area.

However, cloud kitchens can increase competition resulting into less profit.

One major expense for a restaurant is rental costs for a dine-in area.

That is what makes a restaurant a restaurant, rather than a takeaway. Restaurants didn't end up with dine-in areas by accident, nor do they offer in-house dining as some kind of loss-leader, they have it by choice because it makes them more money!

(that is, pre-Covid, of course...)

Huh? Are you saying the restaurant can suck more rent from dinners than the landlord from them?

I think that was true in certain situations, but very hard to pull off in general. We are seeing a shift away from restaurants as a luxury good, and in doing so I think the mythos of white table cloths, domestic labor cos-playing, etc. will go away. That, in turn, was I think a big part how they raised margins, so I think the basic cloud kitchen premise is correct.

>Huh? Are you saying the restaurant can suck more rent from dinners than the landlord from them?

It's hard, but many do it. The biggest advantage sit-down has is "addons", primarily booze. Breaking even on the food and making a profit on beer, wine, and cocktails is very common. Cocktails are intended to be drunk at the time of mix, and I have better quality and cheaper wine and beer already at home. No reason to order it with delivery.

Also when you're in the restaurant, you can (and are encouraged to) keep ordering more food vs a one time transaction on your phone.

Huh? Are you saying the restaurant can suck more rent from dinners than the landlord from them?

Absolutely. That's why good restaurants invest in wine stewards, and extra table staff, and coat check facilities, etc... People pay extra for the experience of dining out. Not everyone eats like they're in college for the rest of their lives.

> Absolutely. That's why good restaurants invest in wine stewards, and extra table staff, and coat check facilities, etc

True, but this applies to a minority of upscale restaurants not majority of the restaurants. There is of course going to be a need for these date-night, business-lunch like restaurants that will always cost more than cooking at home.

There's a lot more going on than you think. Not everything is a guy in a tux. Lots of subtle things that are done that you aren't meant to notice, like paint color, lighting, furniture placement, menu formatting, etc...

Restaurants are a science. There are entire companies devoted to using subtle cues to get dine-in people to stay for dessert.

I would think only the bigger non-upscale restaurant (groups) could afford such a thing.

It's not an entirely unconstrained choice, though, since in most cities there's a substantial chunk of regulatory compliance involved in setting up and running a commercial kitchen. Large fixed costs favor in-house dining with a staff of 15 over takeaway with a staff of 3, even if the latter would be better for the owner on the margins.

The trend of the future:

"Distributed hyper-local private ghost kitchens". (OK, I just mean home cooking).

But looking at your own kitchen as a tiny business, it's pretty clear that market size (OK, I just mean household size + friends & relatives) is probably the key factor in amortising overheads (food waste, labour, fixed overheads like space & equipment, etc).

> For example time spent cooking, grocery shopping

The time most people would spend cooking or grocery shopping isn't financially valuable time: it isn't time I would've worked another hour, and if I did, I'm salaried so the wage is the same.

For some, it will still feel comparably expensive. Why spend $25 on delivery, if I'm not going to do anything for the next hour anyways and raw materials cost $5? I'm paying rent on a dwelling that has a stove regardless of the decision.

It comes to having the disposable income and being price insensitive.

> Why spend $25 on delivery, if I'm not going to do anything for the next hour anyways and raw materials cost $5?

I think the idea is the overall costs will be similar enough that a lot of people would consider delivery from cloud kitchens. This does not apply if it costs 25 for delivery.

For people who have ample time, retired people, people who take care of their kids home, the time factor doesn't apply. But nothing really applies to 100% of the population.

If the costs are similar, people would rather spend an extra hour with their loved ones, playing video games or whatever makes them happy than cook.

In Bangkok, this is very true already for me

Exactly.

Until preparation and delivery become roboticized, it is absolutely not true.

I live in New York City, eat meat, and it's easy to spend only ~$300/mo. on groceries for the month if you're paying attention to prices and cooking yourself.

That's $3.25 per meal. Please show me how exactly I can get nutritious full prepared meals at this price, let alone delivered...

I noticed sometimes that frozen dinners in the supermarket are sometimes 10/$10.

Maybe this doesn't qualify as "full" (or possibly even "nutritious") but could food preservation figure into it?

also, recognize there is a demand.

Another thing I think about, is that probably in the 90's (the era of the CD) I remember meeting someone who worked in digital music (this was so long ago I can't recall who). But I remember what he said "in the future, digital music will probably cost like 10 or 20 cents a song or less". I couldn't imagine it at the time.

Could the same happen with food? Maybe there's a lot of overhead built into our current model of getting "cheap" groceries and cooking.

Could $300/mo on groceries be expensive compared to buying component items like flour or rice or salt?

and what if delivery brought a week of meals instead of one-offs?

I suspect it is possible, but margins will be very tight and will require volume/scale and velocity.

Velocity (in money) is an unintuitive concept (Returns = Margin * Velocity), but it's how many ethnic grocers get returns on relatively low margins. (that, and tremendous cost control, staffing with family members, different supply chains, etc.)

$300/mth sounds about right (I checked mine, ~$325 in Chicago, at big box grocery stores, eating healthy, lots of meat and produce). There was a time when I was shopping exclusively at ethnic groceries and my average was ~$200/mth ($50/wk).

I’m curious - how much do you earn per hour and how many hours do you spend on cooking/shopping/cleaning per month?

Well I'm certainly not telling you my salary. :P

But I cook for myself because food prep/delivery simply isn't nutritious enough. There's just no way to get enough high-quality protein and high-quality veggies. (Like, I order a salad, and it has 3 cherry tomatoes in it when I want 20. Or the salmon filet is 3 oz when I need 10.) Delivery is either way too high on carbs, or way too low on calories.

And here's the secret: if you do all your prep work and actual cooking in huge batches and then freeze, it takes remarkably little time. I'll cook two pork shoulders, or ten pounds of chicken thighs, or twelve eggplants, at a time. I've got probably 200 Rubbermaid freezer containers of various sizes.

Then when it comes to mealtime, it's just assembly that takes 5 minutes. Microwaving protein, assembling a salad, toasting some bread. An easy breakfast burrito in a pan with some fresh eggs. That kind of thing. And of course I throw everything in the dishwasher afterwards, and it definitely takes less than a minute to wipe down my counter and stove afterwards.

I shop once a week for milk, eggs, fresh produce, etc. It takes a grand total of a half an hour.

Granted I have a lot of culinary experience. But honestly, the total time spent cooking+shopping is minimal. Plus I enjoy it anyways.

I mean, if you're making complicated recipes every night cooking can easily consume all your free time. But if you plan, prep, freeze, and never use recipes because you know how to cook from experience, the time spent just isn't significant in your life.

Thought exercise: I’ve often thought that some sort of “CDN for food” would be necessary to make food delivery competitive with groceries and home cooked meals.

How it would work is:

1. You tell the service that within a certain time slot, you’d like your order of [insert order here] to be delivered.

2. All your neighbours do the same

3. At the time slot, a vehicle (or robot) deposits the food in some kind of storage locker for you and several of your neighbours to pick up.

This would substantially drive down the per-order delivery cost.

A dense city where everyone lives in apartments, such as New York, would be an ideal place for this idea, since orders for everyone in your building could be dropped off at one point

Exactly.. I work in food tech and batching is a MASSIVE focus for both delivery products and ghost kitchens (colocating many restaurants) because of the kind of efficiencies you can squeeze out of it.

It sounds great in theory.

The problem is that people want 30 different types of food (Chinese, Italian, Ethiopian), they don't want it cold, and while NYC is dense it's not dense enough.

Even in a building with 100 apartments (which is much larger than the norm), at most maybe 2 apartments will want the same type of food in the same half-hour slot. It's not going to be much different from what a delivery driver already does, which is take out 3 orders from the same restaurant to 3 different buildings at the same time.

And remember that's just the delivery aspect. The costs of food prep are massive too.

What if you had 30 different restaurants at the same place ?

Exactly what the OP article is about, but yes, that would be perfect for this type of application.

Cloud kitchens, with dozens of restaurants, delivering food to a single drop point, serving dozens of residents at once, would enormously drive down delivery costs. Likely to well under a dollar per order.

I think the biggest stumbling block with this idea is that enormous amount of customers that would be needed to make this operation efficient. You’d need to convince hundreds of people within a neighbourhood or apartment block to give up cooking, and rely on the delivery service

Have you ever come across a restaurant that had "Ordinary" in its name and wondered why? "Ordinary" was a set-meal served at a certain time in a pub, for a fixed price. The logical progression for what you proposed is a neighborhood canteen on wheels. The appeal of takeaways/deliveries is anything you want anytime you want it. The two don't converge.

They can converge. In Colombia, where instead of office cafeterias/canteens you have tiny independent set-meal/fixed price restaurants everywhere (often multiples per block). Even before Covid you could get subscriptions to have a lunch delivered to your office every day.

If more people work from home in the future it could make sense as an alternative to the office canteen, not the traditional anything anytime takeaways.

I don't know how it's going to happen (if I did, I'd be a billionaire) but I am pretty confident for the same reasons that I don't build my own mobile phones or furniture or sew my own clothes, I eventually won't cook my own food, except as a hobby the same way people make their own furniture and clothes today. I can't make a McChicken sandwich for $1.39 so in some ways we're already there.

It may be possible if you reduce menu choices to 4-5 / day and sell monthly pass i.e. you'll have to buy at least 20 meals a month. This will allow for bulk cooking and bundle delivery to reduce the costs. Fixed demand allows you to predict cost and expenditure.

Think it depends on your living situation.

I have been living alone for a long time, but was used to having lunch in cafeterias / restaurants and only cook on weekends mostly. Over the last months of working from home, deciding to cook for myself ~90% of the time, it took me quite a while to figure out a good balance between being cost/time effective, having little waste as well as being reasonably diverse and fresh. E.g. what I have seen some times, that people food prep on Sunday 5x the same lunch to eat during the week, absolutely does not work for me.

It is cheaper than having food delivered, but only if I don't count my own time. If I didn't actually like cooking or weren't reasonably good at it, I would order food most of the days.

It will never become cheaper because VC scum needs to eat and pay thousands of developers to constantly rebuild their engineering playground.

Let's assume for a second that it is actually cheaper for the company (a very big "if" considering the profitability of current delivery operations), do you really think they'd just pass on the savings to you, as opposed to pocketing them and/or wasting them?

I hope the copy writer got paid up front. With almost half a billion in VC debt, GhostKitchens can afford it.

The writer is ex + early Uber, I'm sure he's doing fine.

Well, they do say organic is best if you can get it.

Cloud kitchens also consolidate geographically associated, demographically rich, heavily identifiable consumer data in ways we haven't seen outside of retail, and with more richness and more intimacy than retail is capable of.

Amazon might sell you everything else ever made, but they aren't feeding you a hot meal, not learning what you're in the mood for, what you like to share with your friends and family, what experiences you prefer and reject down to individual condiments on an individual item, not yet, and then find you and physically go to you where you live, and where you work, and where you hang out — these vertical cloud kitchens will.

This is a goldmine for a very narrow slice of the tech economy, and like many tech disruptors the efficiency gains wrung out of the model won't make your life better as much as it will hurt the places you already use, all to benefit someone else the most.

The price or quality won't (and in places where these are already common, doesn't) matter as much as the information these extremely vertical operations can aggregate.

I was introduced to the idea of ghost kitchens a couple years ago. Initially, I was pretty keen on the idea. But at the time, we already had ghost kitchens operating in LA, and since then we've seen more open up. What have I not seen? Cheaper costs as a result. Now, delivery apps are flooded with a bunch of companies I've never heard of, I don't know if they're good, I don't know if I can trust them, and at the end of the day they're simply not cheaper for the consumer (one of the touted advantages).

I still think the idea has potential, and it sounded like Cloud Kitchens was genuinely doing some innovative stuff (I interviewed with them﹡), but I'm not convinced that potential will actually be realized. If the market shows it is willing to bear $X for some Nashville hot chicken, what motivation does an operator in a ghost kitchen have to undercut that rather than try to increase their razor thin margins?

At the end of the day, my excitement around the idea is around enabling entrepreneurial chefs, but it's sort of like a talent show - for every 1 great talent, there will be hundreds of less stellar entries, plus the inevitable business folks. It's an interesting idea, and it'll be interesting to see how it plays out over the coming years. That said, I'm more likely to support good brick and mortar companies that help build up the neighborhood community (especially in a city like LA that generally lacks a sense of community).

﹡They spent more time touting their FAANGU(ber) employees than selling the company and ultimately the in-person experience was one of my most loathed interview experiences. This was awhile ago, things could have improved since then.

> They spent more time touting their FAANGU(ber) employees

To me this seems like a major red flag and one more sign of them planning to build an engineering playground as opposed to actually solving the problem their business claims to want to solve.

How often do other HN users get takeout and delivery in an average week?

For myself I usually grab one takeout meal a week. I haven't had food delivered in years.

The proliferation and mainstreaming of food delivery with all the food apps is one of those big trends that totally passed me by. I'm not really happy about the whole thing since it seems to only be working because of squeezed independent restaurants, low paid gig-workers, and lots of VC cash injections. In it's current incarnation, it's not really sustainable but with Covid killing off a huge swath of restaurants that calculus has totally changed.

I expect that to only last for a while though. Restaurant people are an independent and cantankerous group. Ghost kitchens might be a good place to start - like food trucks - but most will want to move on to their own place eventually.

Even before COVID there were a lot of trends supporting food ordering among the working class: depression, anxiety, car-lessness, weed legalization, etc. I'm not happy about the volume I've been hitting ranging from maybe 2-5 times a week.

Yeah, if you don't have the space to cook in, or are shuffling between multiple jobs and don't have time to shop/cook then takeout is the only real option.

I'm not knocking takeout and delivery at all. The huge proliferation of it is just alien to how I operate so it's interesting to hear what other people are up to.

I knock the monopolistic-capture by organizations like Ubereats who have to take a huge chunk to justify their VC investment. Restaurants need every ounce of margin they can get if they're ever going to have a hope of adequately compensating waiters, linecooks, and other staff, who are extremely exposed to covid and poorly treated in general - not to mention drivers.

Pre-covid 90% of my meals were delivery. Though to be fair I typically only did one order per day.

Post-covid certainly have been doing most of the cooking at home.

Now it's probably 50/50 depending on the week.

I've been getting it once a day for a couple weeks now.

> As with any new technology,

Not a technology.

> the naysayers have already published conclusive takes on why this is an episode from Black Mirror

This is a fairly dismissive treatment; it's quite reasonable to raise concerns about this sort of new business practice.

All in all, a strange, low-content article.

I think they mean "technology" in the modern Silicon Valley sense of financial tech, commodification of services, and eventual monopoly rent seeking.

This seems very ambitious:

"It will soon be just as cheap to have your food prepared and delivered as going to the grocery store and making it yourself."

It depends on how many variables you bake into the equation. Such as the total time cost spent shopping/storing/cooking/cleaning vs ordering. The amount of food waste in a home kitchen vs commercial. Economies of scale implied in commercial food preparation vs home etc...

It's certainly conceivable to have the overall costs be similar. Or at least close enough that it becomes an irrelevant change to improve convenience. In the same way that we could all grow our own potatoes for less than the store cost, but we don't.

> better for restaurants and chefs by lowering the entry barrier to start a business

Ultimately this winds up better for the owner of the CloudKitchens and worse for restaurants and most likely consumers. Already these services create their own restaurants to compete with the businesses paying them for the space.

How long before they are using the data of a successful place to create a knockoff that ranks higher? It's probably already happened.

Is anyone interested in working there? I know they are looking for strong SWEs. dm me (y<username> at gmail.com) if interested.

Any chance of sponsoring canadian work permit or hiring only in SF/US?

It's crazy how easy it is to rehabilitate your image in the valley. There's literally a book written about early Uber's toxic work culture yet I'm sure you'll get tons of message from those willing to work for Kalanick.

I did read the book and i didn't find anything too toxic.

Especially is you compare it to other industry giants (hello stack ranking and sports team mentality.)

Not sure if this is mentioned but it sounds similar to another restaurant disruption that gained ground recently, I'm talking about redesigned food courts. The idea was an artisanal food courts that chefs could rent stalls in. I am sure they are still around but I know there was a lot of fuss over their exploitative practices.

ghost kitchens serve companies, but who has the ingredients (pun intended) to serve consumers with fresh, personalized meals?

* fresh ingredients? * locations near consumers? * food and cooking licenses? * space for cooking equipment?

amazon, by way of its whole foods acquisition. whole foods already uses humans to create personalized coffee, juices, sandwiches, and burritos on demand.

it would be unsurprising if they are exploring robots to automate simple meal preparation and expand into other areas.

"It will soon be just as cheap to have your food prepared and delivered as going to the grocery store and making it yourself."

That's a strong claim.

In 18 months, if there is a vaccine, won’t the demand for delivery decrease? I order food now for delivery I have no interest in delivering once it is safe to go out.

WeWork for kitchens is an interesting mixed bag.

> It will soon be just as cheap to have your food prepared and delivered as going to the grocery store and making it yoursel

The techno-utopianist I cannot beat out of me is excited. It is rediculous that we avoid economies of scale to save money.

> Drivers

Damn, to think the rest of the US is doing car delivery is ridiculous. NYC's ubiquitous bike delivery is a great example of why density is just more efficient.

> > The “ghost kitchen” would change all of that. In place of small businesses there would only be a series of tractor trailers staffed with interchangeable “freelance contractors” cooking, presumably with no benefits or fixed hours.

Lol I don't think much people get benefits at restaurants already. Still, the quote is absolutely correct, they won't start getting it either. IMO every "gig work" company should be pushing hard as hell for universal healthcare etc., as removes a huge competitive advantage of their competition. Do it for the $$ not the altruism, if you must.

-----

Here's what I'm wondering about. The food seen for rich people has dramatically improved in the last 30 years. One way to think of this is rich Californians setting an example of "slow-food" / embracing unproductivity at every link of the supply chain to side-step all the grain subsidies and other perverse incentives.

What we're seeing now is the beginning of others cooking for you as a non-luxury item. This is good. I think this means a lot of that bad stuff will be harder to at the same price-point. This is bad for me but perhaps good for society. Anecdotally, I feel like after getting better for a long time, delivery food has been getting worse in NYC as the margins get tighter and competition fiercer.

There's two outcomes;

- we all eat like shit, as increasingly not only is ordering cheaper than cooking, but the expectation of ordering means people will not be able to afford to take time off to cook[1]

- Or, since nothing motivates political action like the loss of privilege within leaving memory, this will put new wind in the sails of the fight against the grain subsidies.

[1]: Employment always takes a greater share of our time despite productivity improvements, probably due to https://en.wikipedia.org/wiki/Jevons_paradox. this is Capitalism's #1 bug.

> others cooking for you as a non-luxury item

Interestingly, this sounds more like a regression, since in most urban but poor countries it's already cheaper to eat out than prepare food yourself. This comes down to the cost of labor: a restaurant can buy in bulk cheaper than you can and prepare in batches larger than you can, so they'll be cheaper than you as long as their labor cost doesn't obliterate the advantage. In Europe or Australia it does, so eating out is a luxury; in India or China it does not.

Obviously this is a generalization, there are countries that buck the trend (eg Japan) and some meals that are still cheaper to DIY. But I don't think we'll get to techno-utopia here until robotic food preparation goes from gimmick to mass market, and we're still a long way off.

Yes I absolutely agree. While I think it's generally good when luxuries become widespread, this isn't so good if just means some sort of mass middle class is exploiting some underclass. And we must always be vigilant for low labor costs being laundered as some sort of efficient tech (e.g. Uber in suburbs/rural is just inherently inefficient). It's a cruel irony as-under priced labor is the bellwether for inefficiency.

That said, I hope there's something between now and full italicization that can be economically while paying the few remaining chefs well. Cities should absolutely price-control the shit out of these cloud kitchens since they will be so dependent on the public good that is efficient land use.

In India in China it’s viable for whom? Is it viable for people at or below the median?

>It will soon be just as cheap to have your food prepared and delivered as going to the grocery store and making it yourself.

No, no it won't. Why would a person claim something so ridiculous? I can understand if you never leave your little Soho / Bay bubble, but do real actual people honestly think this?

This seems to be already the case in India with the Dabbawalla system [1], so it's not an outrageous idea - it's simply replacing home cooks with tiny commercial kitchens. They can buy produce in bulk at much cheaper rates than you'll find at your grocery store.

[1] https://en.wikipedia.org/wiki/Dabbawala

It's not the case, because it's not possible for food to be cheaper after prep and delivery. It's cheap, but not cheaper than making your own food from scratch. And there's no oversight or health inspections for this mass prepared food either.

But you know this, it's why you said "seems to be" instead of "is," very nicely done.

You're completely ignoring the food cost I just mentioned. For example, the cost of a Big Mac is around 1 dollar. Try making a burger with ingredients from the supermarket for $1, it is impossible. Things easily cost 5-10x as much in retail vs their bulk prices, it is much cheaper to cook for 50 customers at once than for a single meal.

This system is removing all of the other costs of operating a restaurant, so unless you also buy ingredients in 50kg bags for your home, they can definitely make it cheaper.

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