The Cloud kitchen concept is the next big thing in Dubai. It gained huge popularity and will continue to boom in the future. But the question is how to start a cloud kitchen in Dubai? Well, this guide got you covered.
Starting your own cloud kitchen in Dubai will be like a walk in the park if you follow the steps given in this guide.
So, without any further delay, let’s get started.
Basic Information About Cloud Kitchen Business
A virtual restaurant, ghost kitchen, or dark kitchen are all the terms used to refer to a cloud kitchen. It is a delivery-only restaurant that only offers food delivery and takeaway. There is no option for dine-in in such restaurants. Orders in cloud kitchen models are taken via third-party platforms, websites, hotline numbers, or mobile apps.
The delivery-only restaurant style mostly relies on internet food aggregators for handling huge online orders. These food delivery services include Deliveroo, UberEats, and DoorDash. Therefore, it is quite important and a core demand of such businesses to work with third-party platforms
A delivery-only restaurant is thought to be a high-profit business strategy and involves low risk and low investment. A cloud kitchen allows restaurateurs to try out new formats and experiment with various concepts.
Furthermore, when compared to a regular restaurant, establishing a cloud kitchen is substantially less expensive. This is one of the many reasons why there has been an increase in the introduction of different food delivery business models, including co-working spaces, multi-brand kitchens, cloud kitchens, and aggregator-managed among others in the UAE.
Benefits of Starting a Cloud Kitchen in Dubai
The cloud kitchen structure provides Indian entrepreneurs with a huge number of opportunities while keeping operational expenses considerably low in Dubai. The following are some of the advantages of starting a cloud kitchen in Dubai.
1. Considerably Low Costs
You would spend substantially lower costs to establish cloud kitchens than traditional brick-and-mortar eateries. They also need fewer accessories like advertising and signage, less space, and a small staff.
2. Very Low Risks
Existing restaurants can use cloud kitchens as a low-risk platform to test new concepts or foods before introducing them to their target audience.
3. Various Expansion Opportunities
Restaurateurs can use a cloud kitchen to experiment with new formats and ideas. Co-working spaces, aggregator-managed cloud kitchens, and multi-brand kitchens are just a few of the food delivery business models that have grown up significantly as a result of the inspiration that comes with them.
4. Extreme Flexibility
The menu in a cloud kitchen can be modified more quickly than in a restaurant. You can replace digital menus in minutes. Hence you don’t need to spend money, effort, and time changing physical menus. Furthermore, you may easily alter the menu in no time if a food item is short and not available in the required amount.
5. Highly Efficiency
Restaurants are less popular in comparison to cloud kitchens. During peak hours, it is a challenge for restaurants to handle delivery demands and accommodate dine-in customers. The cloud kitchen business, on the other hand, concentrates solely on a delivery-only strategy and hence it is more efficient. Last but not the least, the food delivery service is significantly more straightforward and efficient.
Steps to Start Cloud Kitchen in Dubai
1. Choose Company Name
Before launching any business in Dubai, you must first choose a company name. Furthermore, you must abide by a set of naming rules and regulations before deciding on the company name.
Any unpleasant names, derogatory language, or names of well-known organizations should be avoided. In addition, be sure the business name you wish to use can be registered easily.
2. Find a Location
To run a successful cloud kitchen, you do not need to find a location that is in a popular region. Instead, cloud kitchen business operations can be conducted out of a small building. This ultimately cuts costs to a great extent. Market backsides, residential zones, and new parking lots are all possible locations for ghost kitchens. As a substitute, you might save your capital on business startup fees by using a shared cooking area.
3. Finalize Equipment
The cuisine you plan to serve will determine the type of kitchen equipment you need to get for your kitchen. But a cooking range, cutting knives, refrigerator, and oven are a few must-have items that you must get for a cloud kitchen to operate.
4. Food Packing
Another important aspect of owning a food delivery business is food packing. Regardless of the food quality, your food packaging will play a crucial role in providing a fantastic customer experience and maintaining your brand’s reputation. To make sure that your food is properly packed, invest in high-quality plastic containers, spoons, cartons, and other packaging materials that match industry requirements.
5. Get Necessary Licenses
Before starting a cloud kitchen business in Dubai, you must first obtain all the required permits and licenses. Furthermore, obtaining the required legal documents will save you money and time in the long run.
a) Trade License
Before you apply for a trade license, choose your jurisdiction for operating your cloud kitchen. It can be either the mainland or a free zone of Dubai. You will be submitting your application to Dubai’s Department of Economic Development (DED) in case you select the mainland.
Those who choose free zones will visit the relevant controlling authorities for getting trade licenses. In both jurisdictions, approving business activities and trade names is important.
b) Food License
The Food Safety Department of Dubai Municipality is the legal body that oversees the issuance of food licenses. If you want to get a food license, you have to submit your food preparation area floor plan to the authorities. The complete floor plan includes ventilation points, food storage spaces, windows, food processing equipment, exits, entrances, and washing equipment.
c) Apply for Other Applications
Besides the above-mentioned licenses, you also need a resident visa to run your cloud kitchen in the UAE. The complete procedure includes a chest x-ray, biometric scan, and a medical exam.
If you own a UAE company license, you have the perk of sponsoring visas for your relatives, friends, family, and foreign employees.
6. Hire Staff
A classic cloud kitchen business setup does not include Front-of-House operations. So, you won’t need a large crew to operate your cloud kitchen. With just a small staff, you can quickly launch a cloud kitchen business. If you operate a plethora of brands out of the same kitchen, the same chef can make food and dishes for all of them. It is best to set up this kind of business with a small crew and expand the number of people as per the increase in incoming orders.
7. Open Account in Corporate Bank
To start a cloud kitchen in Dubai, you’ll need a business bank account. You can choose any good bank in Dubai, UAE, and open your account in it. A bank account will also be useful in making online transactions and transferring money between different accounts for business purposes.
How to Get a Lot of Online Orders and Marketing
You’ll need to spend a lot of money in the beginning to promote your food delivery business. It is a major requirement because a cloud kitchen relies solely on internet and telephone meal orders. Online marketing becomes very crucial when you don’t have signs to establish brand recall, a storefront, or display boards.
List Your Cloud Kitchen On Online Food Aggregators
It is essential to put your cloud kitchen on online food aggregators because your target demographic is likely to use these platforms. To register, go to the aggregators’ website.
Promoting Your Cloud Kitchen On Online Aggregators
Paid marketing is critical for every new restaurant to make it profitable. It’s a good idea to promote your cloud kitchen on third-party online food aggregators. They provide your restaurant brand with more exposure. But these aggregators charge a higher percentage of every order revenue. Consider paying for marketing to help you promote your company more effectively.
Social Media Marketing
Paying attention to social media marketing for your cloud kitchen business from the start is always a smart move. Create a Twitter, Facebook, and Instagram account for your business. Publish interesting photographs of your promos, services, and food on your social media accounts. Consider running sponsored social media ads to reach a larger audience and increase online orders. Use hashtags that are relevant to your audience to connect with them.
Search Engine Optimization
When a customer looks for your online food websites on Google or Bing, you must make sure it ranks higher on the search engine results. Make sure your website is optimized for search engines by using the proper keywords and phrases, and the design is mobile-friendly.
Loyalty Programs and SMS & Email
Tailored email and SMS campaigns, and Loyalty programs have a high return on investment if they are properly designed. To maintain the loyalty of your customers, send highly targeted email and SMS marketing based on their order history.
Technology Needed for a Cloud Kitchen in Dubai
A virtual restaurant relies heavily on technology to streamline order management. A cloud kitchen business needs an integrated online food ordering system that speeds up operations and quickly accepts orders online.
The following are the technology requirements for setting up your cloud kitchen business.
Robust Inventory Management System
To reduce food waste and manage stock-in-hand, you must have inventory control in your cloud kitchen. A top-notch inventory management system will allow you to keep an eye on daily stock usage and alert you when extra stock is required. It will also assist you in controlling your food prices.
Centralized Ordering System
Any cloud kitchen business needs a modern POS system that can centrally receive orders from numerous online food aggregators. Manually entering order details into the POS system is a major pain for cloud kitchen owners that have listed their restaurants on various online food ordering platforms. Invest in a POS system that keeps track of orders received through different platforms and accepts orders from a variety of sources.
Call Center Panel To Receive Telephonic Orders
You better go for an integrated Call Center panel for your cloud kitchen if you get a lot of telephonic food delivery orders. Having such software will let your telephone orders be streamlined and logged directly into the POS. You can also view client order history and information, eliminating the hassle of asking for customer information such as addresses repeatedly.
Online Ordering Via Website and/or Mobile App
Only collaborating with online food aggregators is not enough. Other than that, you must create a mobile app or website to receive orders. Create a user-friendly and well-optimized online ordering restaurant mobile app or website enabling consumers to easily order food online from the comfort of their homes. To get more online orders, perfectly design your food ordering landing page keeping the digital marketing aspects in mind.
Integrated Delivery System For Food Delivery
Thanks to an in-house delivery system, you can swiftly assign orders to delivery executives based on their availability and location. With such a system, you can also send automated SMS notifications to your customers and follow the status of orders to be delivered.
Integrated Kitchen Display System
An integrated Kitchen Display System is a must-have technology in a fast-paced cloud kitchen to optimize total order preparation time. The order of a customer is instantly updated in the kitchen display system as soon as it is received. This type of system not only detects any lags in order preparation and optimizes the preparation time, but it also improves the smoothness of cloud kitchen operations.
Third-party internet applications are excellent tools for enhancing revenue and expanding the potential market of a cloud kitchen. But these tools have some sort of control over the data being received from your customers which makes it challenging to develop an understanding of your clients’ personas and hence impactfully drive repeat business.
To overcome this issue, you should strive to maximize direct orders from your company’s social media channels and website to collect enough client data to fine-tune your marketing activities and products.
How to Accept Orders
When starting a cloud kitchen, one of the most critical operational considerations to make is how to receive and execute the food orders of your customers. While emails and phone calls are perfectly fine, working with a well-known online delivery software will significantly increase exposure, efficiency, and thus revenue of your cloud kitchen in Dubai.
Cloud Kitchen Dubai Cost
The cost of setting up and operating a cloud kitchen in Dubai depends on a number of factors. The most significant factors to consider are your investments, company size, maintenance, location, employee count, menu creation, and government procedures.
Speak with a representative from Riz and Mona for a customized estimate of the cloud kitchen business setup cost in Dubai and other charges related to the establishment of a cloud kitchen in Dubai.
Riz and Mona can advise you on the complete process for setting up a cloud kitchen in the UAE and assist you with obtaining the required food and trade License. We will also make sure that you run your cloud kitchen in Dubai while following the Dubai food code. Contact us now for assistance on business setup or company formation in Dubai.