Starting a meal delivery service is a fun and profitable venture. Working in this sector of the food service industry entails serving customers you may never see face to face. Rather, you will transact with them digitally, and the food will be delivered by a third-party source.
Additionally, as compared to typical brick-and-mortar restaurants or food trucks, you will save money on startup fees. That’s one of the most significant advantages of operating a delivery-only restaurant!
Setting up a ghost kitchen (sometimes called a dark kitchen or virtual kitchen) will be one of your top costs in this type of food business. While you don’t need a full restaurant to start a meal delivery service, you also can’t do it from your own kitchen. In order to serve customers legally, your food will need to be prepared in a commercial kitchen facility.
Table of Contents
- How to Set Up a Ghost Kitchen
- 1) Register Your Business
- 2) Get Liability Insurance
- 3) Get ServSafe Certifications
- 4) Pass Health Inspection
- 5) Explore Payment Options/Plans
- 6) Use Local Delivery Software
How to Set Up a Ghost Kitchen
The emergence of delivery-only restaurants, as opposed to eat-in restaurants, has resulted in a major increase in the availability of ghost kitchens in recent years. These shared facilities are designed to be utilized by numerous businesses and are frequently rented out in hourly, daily, or monthly increments to multiple tenants rather than being rented out for years at a time to a single business.
Typically, you’ll be expected to pay a deposit up front, but then you’ll be able to book and pay for your time in the space on a pay-as-you-go basis. This payment method reduces startup expenses by allowing new firms to pay just for the hours they intend to operate. However, in order for your restaurant business to run efficiently and legally, you must meet numerous other practical requirements when operating a ghost kitchen.
1) Register Your Business
Running a business necessitates filing a tax return with the government. While your location and business structure will define how and where you must register, most small businesses will be required to do so with their city, nation, and maybe state. Most small firms aren’t required to register with federal agencies beyond obtaining a federal tax ID. In addition to legal and tax advantages, registering your business may bring certain legal and tax advantages.
To begin, you’ll need to apply for a business license with your city or county. You will most likely be required to fill out an application and pay licensing costs as part of this process. While some agencies allow applicants to submit their applications online, the majority still need them to be delivered or returned in person. This process can cost anywhere between $50 and $500 depending on the specifics of your registration.
2) Get Liability Insurance
You’ll be closer than ever to establishing your business after you’ve located the ideal shared kitchen space, but there are still a few boxes to tick. You will very certainly be required to have a $1 million general liability policy with the kitchen listed as a co-insured, or additionally insured, company, regardless of the ghost kitchen space you choose to work in.
These policies are in place to safeguard both you as the business owner and people who own the kitchen from any potential damages or accidents. In average, you should expect to pay between $300 and $500 per year for such insurance coverage, depending on the carrier you choose, your area, and a variety of other considerations.
While the kitchen is likely to be the first entity to require liability insurance, you will very certainly be required to give proof of insurance to a number of other vendors, service providers, and businesses with whom you collaborate while operating.
3) Get ServSafe Certifications
Your local or state agencies are likely to demand that you have a valid ServSafe Certification as well. ServSafe is a nationally recognized food safety standard with two certification options: ServSafe Food Handler and ServSafe Manager.
While both certifications ensure that you have the knowledge and skills to safely prepare food for the public in order to protect them from foodborne illness, the former is intended for individual employees of a business, while the latter is intended for the person in charge of a food preparation site.
The National Restaurant Association is in charge of the training, tests, and certificates. You must finish an authorized course and a 40-question exam to earn the Food Handler certification. Similarly, to earn the Manager certification, you must complete a course and pass a 90-question multiple-choice exam.
You will almost certainly be needed to earn a ServeSafe® Manager certification as the chief operator of your delivery food business. The courses can be taken in person or online in most situations. Regardless of which course option you select, the total cost of certification, including course and exam fees, should be around $200.
4) Pass Health Inspection
You will likely have to pass a health inspection from the appropriate county or state authority before you can start operating. This will necessitate an on-site evaluation of your kitchen’s production and preparation methods, food storage spaces, and overall operating processes.
For your final inspection and licensing appointment, make sure that all of these items are properly and completely documented. This procedure may appear frightening, but the inspector is only interested in knowing that your company will produce food in a safe and legal manner. Consider them as a source of information for running a legal business.
5) Explore Payment Options/Plans
You may wish to discuss other payment options or plans with your kitchen in addition to providing proof of insurance. While daily or even hourly reservations can be beneficial when you’re just getting started and have limited cash, as your business grows and you experience more success, you may want to seek a longer commitment or agreement.
Monthly plans at a discounted hourly charge are common in communal kitchens. This is beneficial to you because you will pay less overall for the space, and it is beneficial to the kitchen since they will have assured business for the next month or months.
Similarly, if you want to operate your business late at night (for example, to cater to shift workers or students at the local university), you should inquire about off-peak rates with your kitchen manager. This will benefit you since you will pay less to use the space, and it will allow the kitchen to generate cash during hours when it would otherwise be unoccupied. Even if your kitchen manager hasn’t considered these circumstances before, don’t be scared to negotiate these conditions!
6) Use Local Delivery Software
The delivery software you choose has a direct impact on the customer experience. That is why taking the time to find the best local delivery software for your company is so important. After all, if your software gives you all you need to fulfill deliveries correctly, your ghost kitchen will be more successful.
Some features to look for in delivery software are:
- Assists with the Fulfillment of Orders: Many pieces of software are just intended to transport you or your drivers to a specific spot. It doesn’t connect to the backend, so you’ll have to go back and correct the orders after the delivery person arrives. A good delivery planner fulfills orders quickly thanks to seamless connectivity with your backend.
- Proof of Delivery: Proof of Delivery will provide you and your clients peace of mind. Multiple delivery images, an e-signature, and an optional delivery note can all be attached by your driver.
- Tracking Pages for Customers: Customers value transparency, thus providing a delivery tracking page where they can track the delivery progress of their products is critical. Customers will be unable to contact you for an update as a result of this.
With EasyRoutes’ delivery software for ghost kitchens, small businesses can receive all of this and more. Ghost kitchens rely on EasyRoutes to get their food into the hands of customers swiftly and effectively. The delivery experience provided by EasyRoutes results in happier customers who are more likely to purchase from you again in the future.
Finding a ghost kitchen operator that can satisfy your brand’s needs is one of the most critical things you can take as a ghost restaurant owner to get your business up and operating. That’s why, at EasyRoutes, we’ve developed the greatest small business delivery management system to assist you in staying ahead of the competition.
Though launching a ghost kitchen may appear to be a daunting task at first, with careful and strategic planning, you’ll be ready for customers in no time!