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In recent years, the growing popularity of digital platforms and changing consumer preferences have led to strong growth in E-commerce companies. It's a completely new concept in the food industry: virtual kitchens--cloud kitchen or ghost kitchen. These kitchens do not have a traditional storefront, but only accept orders online for delivery or takeout. Convenience and speed are two of the biggest market trends in the virtual kitchen space. Increasingly picky consumers looking for fast and undisruptive dining experiences have found their answer in virtual kitchens. Also, the COVID-19 pandemic has spurred on virtual kitchens even more than before: as lockdowns and safety concerns led to a surge in online delivery of food.
During this period, many traditional restaurants and entrepreneurs also turned to virtual kitchens as a way of leveraging digital channels in order to broaden their customer base. The end result was that both supply and demand for the virtual kitchen market grew, with increasing competition from various players answering consumers 'changing requirements. Focus on data-based insights and analysis is also characteristic of the virtual kitchen trend.
As advanced technologies such as artificial intelligence and machine learning are integrated, virtual kitchens can improve their operating procedures, add dishes to the menu, and become even more streamlined. Through data analytics, virtual kitchen operators obtain information on their customers 'preferences and order patterns, as well as inventory management systems. With this valuable knowledge at hand, they make practical decisions in an always changing marketplace.
Another noteworthy trend in the market for virtual kitchens is collaborations and partnerships. Virtual kitchen operators often team up with successful food brands, chefs, or internet celebrities to come out with special and attractive concepts for virtual restaurants. These collaborations not only increase the credibility and fame of virtual kitchens but can also generate interesting, popular menus to attract more customers. Furthermore, sustainability is emerging as a key consideration in the virtual kitchen market trends.
Consumers are increasingly conscious of environmental impact, and virtual kitchens have the opportunity to address this concern by implementing eco-friendly practices in their operations. From sustainable packaging solutions to locally sourced ingredients, virtual kitchens are exploring ways to reduce their carbon footprint and align with the growing demand for environmentally responsible dining options.
Covered Aspects:
| Report Attribute/Metric | Details |
|---|---|
| Market Opportunities | Targeting developing markets |
| Market Dynamics | The growth of food delivery services apps Better convenience, cost-effectiveness, and flexibility of virtual kitchens |
Virtual Kitchen Market Highlights:
Virtual Kitchen Market Overview
Virtual Kitchen Market Size was valued at USD 34.2 Billion in 2022. The Virtual Kitchen market is projected to grow from USD 39.1 Billion in 2023 to USD 80.9 Billion by 2030, exhibiting a compound annual growth rate (CAGR) of 10.95% during the forecast period (2023 - 2030).The growth of food delivery services apps, convenience, cost-effectiveness, and flexibility of virtual kitchens are the factors driving the growth of virtual kitchens.
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
Virtual Kitchen Market Trends
Increasing Demand Of Food Delivery Services Proliferate Demand Of Virtual Kitchen.
The increased demand for food delivery services has created opportunities for virtual kitchens to meet the needs of both restaurants and consumers, and it is likely that the trend towards virtual kitchens will continue to grow in the coming years. As more consumers opt for food delivery, restaurants are under pressure to fulfill a higher volume of orders. Virtual kitchens can help meet this demand by operating exclusively for delivery, with no physical dining space.
Operating a virtual kitchen can be more cost-effective than operating a traditional restaurant, as there is no need for a storefront, dining area, or front-of-house staff. This can make it easier for restaurants to expand their delivery capabilities without incurring significant expenses. Virtual kitchens can allow restaurant operators to test new concepts or menu items without the expense and risk of opening a new physical location. This can help restaurants adapt to changing consumer preferences and trends more quickly.
By operating from a centralized kitchen, virtual kitchens can reach new delivery markets without the need for multiple physical locations. This can help restaurants expand their customer base and increase their revenue. Many food delivery platforms, such as Uber Eats and DoorDash, partner with virtual kitchens to offer a wider range of delivery options to consumers. This can help virtual kitchens reach a larger audience and increase their visibility.
Figure 1: Food delivery market
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
food delivery market was valued at USD 150 Billon in 2022 and is expected to reach USD 340.9 Billion by 2030, growing at a CAGR of 10% from 2023 to 2030. This growth of food delivery supports cloud kitchen concept as its cheaper option for new entrepreneurs to cater easily with low capital in food services sector.
Virtual Kitchen Market Segment Insight
Virtual Kitchen by Component Type Insights
Based on component type, the Virtual Kitchen market segmentation includes hardware, software, and services. The hardware segment accounted for the largest share of this market and is also anticipated to grow at a CAGR of 9.8% through the forecast period. Virtual kitchen hardware includes appliances, tools, and equipment that are used in virtual kitchen setups. This includes:
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Cooking equipment: This includes ovens, fryers, grills, and other cooking appliances used to prepare and cook food. In cloud kitchens, these appliances may be compact and designed for high-volume cooking.
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Food storage and preparation equipment: This includes refrigerators, freezers, food prep tables, and other equipment used to store and prepare food before it is cooked.
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Order fulfillment equipment: This includes packaging and labeling equipment, such as food containers, bags, and labels, used to package and prepare orders for delivery.
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Point-of-sale systems: This includes software and hardware used to process orders and manage inventory in real-time. Cloud kitchens may rely heavily on technology to manage their operations efficiently.
Virtual kitchen hardware is designed to optimize the preparation and delivery of food orders in a virtual kitchen environment. As the demand for online food delivery services continues to increase, cloud kitchen hardware is likely to play an increasingly important role in the food industry.
Figure 2: Virtual Kitchen Market, by Component Type, 2022 & 2030 (USD Billion)
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
On the other side, the services segment is also anticipated to grow with a CAGR of 24.81% over the forecast period. The market for virtual kitchen is predicted to have the second-largest proportion in the service sector. Virtual kitchens may offer a variety of cuisines and dishes that can be customized based on customer preferences and dietary restrictions. This allows customers to have a more personalized dining experience.
Virtual kitchens rely heavily on online ordering platforms such as Uber Eats, Grubhub, and DoorDash for customer orders. These platforms provide a convenient way for customers to order food and have it delivered to their doorstep. Virtual kitchen services may provide customer support through various channels such as email, phone, or live chat. This allows customers to get quick answers to their questions and resolve any issues they may encounter.
March 2023: - Kitchens@ Acquires Swiggy's Cloud Kitchen Arm 'Swiggy Access'. Swiggy sold its business at an undisclosed amount with all equity deal.
February 2022 - Curefoods Pvt Ltd, a cloud kitchen startup floated by Cure.fit, which houses brands like EatFit, CakeZone, and Aligarh House, bought Accel-backed Maverix Platforms Pvt Ltd, which runs ready-to-cook food brand Fingerlix, for an undisclosed amount.
Virtual Kitchen End-user Insights
Based on end-user type, the Virtual Kitchen market is segmented into commercial space, residential and hospitality. Due to low cost and ease to reach viability in residential locations, there was a huge surge in delivery from these virtual kitchens. After Covid, with new normal there was a huge decline in dine in and on contrary a huge surge in online delivery. Due to limited food option, cloud kitchens/ virtual kitchens had shown a huge penetration among residential customers.
Virtual Kitchen Regional Insights
By region, this market has been segmented into North America, Europe, Asia-Pacific, and the rest of the world. The North American region dominates this market with a significant share of 65.9% in 2023 and is also estimated to witness good growth with a CAGR of 9.7% during the forecast period. The virtual kitchen market in the US is growing rapidly, driven by factors such as the increasing popularity of food delivery services, rising urbanization, and changing consumer behavior.
The virtual kitchen market in the US is becoming increasingly competitive, with a growing number of players vying for market share. Some of the major players include Kitchen United, Zuul Kitchens, and CloudKitchens. Many virtual kitchens in the US partner with food delivery platforms, such as Uber Eats, Grubhub, and DoorDash, to reach a wider audience and increase their visibility. Some virtual kitchens in the US are expanding beyond delivery to include pickup options or even physical storefronts. This can help to differentiate them from competitors and appeal to a wider range of consumers. The virtual kitchen market in the US presents opportunities for innovation, such as the use of robotics and automation to streamline operations and reduce costs, and the development of eco-friendly virtual kitchens.
On the other side, the Asia-Pacific is also projected to become the second-largest region across the globe at a CAGR of 18.37% from 2023 to 2030. The Chinese government has been supportive of the virtual kitchen industry, as it can help to address food safety concerns and support the development of the country's digital economy. The virtual kitchen market in China is highly competitive, with a large number of players vying for market share.
Some of the major players include Panda Selected, Eleme, and Meituan-Dianping. Many virtual kitchens in China partner with food delivery platforms to reach a wider audience and increase their visibility. For example, Panda Selected operates exclusively on the Eleme platform. Some virtual kitchens in China are expanding beyond delivery to include dine-in options or even physical storefronts. This can help to differentiate them from competitors and appeal to a wider range of consumers.
Figure 3: Virtual Kitchen Market, by Region, 2022 & 2030 (USD Billion)
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
The virtual kitchen market in Europe is growing, although at a slower pace than in other regions such as North America and Asia. The virtual kitchen market in Europe varies significantly by region, with the UK, Spain, and Germany among the largest markets. In the UK, for example, virtual kitchens are becoming increasingly popular due to the high cost of real estate and the increasing demand for food delivery services. In some European countries, regulations related to food safety and hygiene can be a barrier to entry for virtual kitchen operators. However, some governments are taking steps to address these challenges, such as the UK's Food Standards Agency's new guidelines for virtual kitchens.
Virtual Kitchen Key Market Players & Competitive Insights
Major players in the Virtual Kitchen market, include, Kitchen United, Rebel Foods, Keatz, Zuul Kitchens, Kitopi, CloudKitchens, Dahmakan, Swiggy Access, Foodpanda Virtual Kitchen, Taster, Cheetay, The Local Culinary, Smart City Kitchens, Ghost Kitchen Brands, DoorDash Kitchens, Deliveroo Editions, Editions by Uber Eats, Deliverect and Deliveroo Editions.
The market's growth is predicted to be accelerated by the rising adoption of cloud computing and Virtual Kitchen, as well as various strategic alliances and investments among regional businesses. Due primarily to the participation of many equipment suppliers, the United States controls the majority of the market in the region and generates a sizeable portion of overall income.
Key Companies in the Virtual Kitchen market includes.
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Kitchen United
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Rebel Foods
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Keatz
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Zuul Kitchens
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Kitopi
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Dahmakan
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Foodpanda Virtual Kitchen
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Taster
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Cheetay
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The Local Culinary
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Smart City Kitchens
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Ghost Kitchen Brands
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DoorDash Kitchens
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Deliveroo Editions
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Editions by Uber Eats
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Deliverect
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Deliveroo Editions
Virtual Kitchen Industry Developments
March 2023: - Kitchens@ Acquires Swiggy's Cloud Kitchen Arm 'Swiggy Access'. Swiggy sold its business at an undisclosed amount with all equity deal.
February 2022 - Curefoods Pvt Ltd, a cloud kitchen startup floated by Cure.fit, which houses brands like EatFit, CakeZone, and Aligarh House, bought Accel-backed Maverix Platforms Pvt Ltd, which runs ready-to-cook food brand Fingerlix, for an undisclosed amount.
Virtual Kitchen Market Segmentation
Virtual Kitchen Component Outlook
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Software
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Solution
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Services
Virtual Kitchen End-users Outlook
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Commercial Space
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Residential
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Hospitality
Virtual Kitchen Regional Outlook
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North America
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US
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Canada
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Europe
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Germany
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France
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UK
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Italy
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Spain
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Rest of Europe
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Asia-Pacific
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China
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Japan
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India
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Australia
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Rest of Asia-Pacific
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Rest of the World
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Middle East
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Africa
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Latin America
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