Cloud kitchen concept – a new and profitable business model to Develop on-demand food delivery apps
Posted on May 24, 2019 By Dikshita Dudhat
The success of Grain and Dahmakan, the full-stack business model shows a lot of potentials. Get On-demand food delivery app development with Coruscate to reap cloud kitchen business benefits.
Ordering food delivery could be a hassle. It can be tedious to call a restaurant and order your meal. Food delivery apps have provided a trouble-free solution for ordering the food. With the growing popularity of such food delivery apps, people needed a solution to fulfill the orders much faster.
The cloud kitchen concept was found as a way to provide efficient services to the customers. Basically, a cloud kitchen is a takeaway outlet which does not provide the dine-in facility. These kitchens function as a production unit with space for preparing the food. The food can be ordered online so such kitchens are called as the cloud kitchen. Coruscate’s research team is digging deep in the food delivery sector to find out the latest trends and technologies that can boost our client’s business.
While the delivery apps are blamed for cutting down human contact, they have opened new ways of trying various new restaurants and foods. People just need to input their location and the apps provide you hundreds of restaurants in your vicinity. You can get the food delivered at the comfort of your home without moving an inch from your TV screen.
Cloud kitchens are the modern technique used in food delivery services. There are more and more food delivery apps coming up each day with the concepts of cloud kitchen. One such startup from Singapore that has raised a large amount to go after the regional expansion is Grain. This has happened after Uber’s ex- CEO Travis Kalanick intended to grow the concept of such cloud kitchens in China.
Grain was founded in the year 2014 and they specialize in clean food. Though they are a food delivery company, their approach is different than the CloudKitchens and other food delivery apps like Deliveroo, GrabFood or FoodPanda.
It chose a cloud kitchen model in which they used unwanted real estates as kitchens. They have their own delivery services for output. Unlike CloudKitchens and other food delivery apps who rent their spaces to F&B companies as a cheaper alternative for their on-demand delivery customers, Grain has its own chefs, menu and a delivery team too. They have a full stack business model and have successfully deployed the services.
Grain had raised a $1.7 million funding in the Series A round back in the year 2016. Grain has recently raised a $10 million amount for their expansion. According to the news in TechCrunch, CEO of the startup Yi Sung Yong declared that the startup has the growth shooting and was gaining profits year after year. He stated that their business model helped them to keep them the products under control and that was what responsible for the growth of the company. Grain feels the other business models involving different restaurants and delivery persons is much more complicated and needs more efforts for coordination. With its 200 % growth, Grain plans to get overseas with its launch in Bangkok.
Just after the success of Grain, there was another round of success coming for the full-stack food delivery startup of South-east Asia. Dahmakan a Malaysia-based startup has announced that they have raised $5 million funding in their own financing round. The startup was founded in the year 2015. They are also following the full-stack business model with cloud kitchens. All their processes are being done in-house rather than through a marketplace model.
Dahmakan has expanded its branches in its home town Kuala Lumpur and has also introduced some satellite hubs. Through these hubs, the company is able to serve different parts of the city more efficiently. According to a report in TechCrunch, the COO stated the food delivery startup is already ahead in the competition and they have started building clusters of mini kitchens.
Their strategy is to scale up food production for thousands of deliveries while maintaining quality and using technology to go for more and more food delivery orders.
Scope of the on-demand food delivery apps with full-stack model:
Grain is currently delivering more than 1000 of meals every day in Singapore. They are having eight-figure sales every year. They are expanding the hub kitchens outposts placed strategically around the town in order to serve their customers faster. They are even growing the fleet of trucks to retrofit the warm and cold while delivering the food.
The journey of Grain and Dahmakan is proof that the startups have great opportunities in the on-demand food delivery market in South-east Asia. Even if they have to go through the trials these startups are meant to have a bright future in the food delivery sector.
The only thing recommended to such startups looking for a business venture in the on-demand food delivery sector is to grow in a more sustainable and responsible manner. Their focus should be on healthy eating. The companies will be necessarily benefitted from more and more people using food delivery and they can also become attractive acquisition targets in the future.
Grain and Dahmakan put their focus more on healthy eating and stand in contrast to the junk food orders that the other companies provide in the marketplace and restaurants. Their strategy makes them stand out in the competition and helps them hatch to capitalize on the flood in the food delivery sector.
A report published in Southeast Asia predicted that the food delivery market in the region is estimated to grow up to $8 billion in the year 2025. The prediction also states that the on-demand food delivery sector has much brighter growth prospects than that of the on-demand taxi booking apps.
Now, that you are familiar with the growth of on-demand food delivery apps with cloud kitchen models, all you need to have is a technologically efficient app which can make you accessible to your customers.
Coruscate can help you to build an app that has an amazing user interface and smooth functioning with unique features to make you stand out. If you are concerned about your business model, you can connect with us by filling a simple contact us form and our business developers can help you out at our free consultation session.
Get in touch with us to get free On demand food delivery app cost estimation or click below to get free app demo.
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