A cloud kitchen is a restaurant kitchen that accepts orders through online ordering systems. Cloud kitchens are commonly engaged in delivering food orders to the customer’s doorstep. Cloud kitchens may have an online ordering application or website for accepting orders via numerous food delivery platforms. Since these internet restaurants earn their revenue from various online food platforms, it is imperative to have a tracking system in place to precisely monitor deliveries and the volume the business generates from numerous platforms.
This will let the business owner overcome the hassle of adding & measuring orders from numerous ordering systems at EOD. In this write-up, you would come across some key factors that help you built a cloud kitchen company with ease.
Factors to Consider While Setting Up a Cloud Kitchen
Following factors are of utmost importance and should not be overlooked while setting up a company.
- Location and Property
Location & Property
Property and location are the primary differentiators between a cloud kitchen and a conventional restaurant. You don’t require a primary property location to set up a cloud kitchen. Instead, you can build it up in a premise that is 250-300 Sq Ft in size. This would help you save a considerable amount of money for building a cloud kitchen.
Cloud kitchen could be built in an area that is fairly inaccessible provided it has ample demand for food items. Residential areas, unused parking spots, and market backsides are a perfect destination for setting up a cloud kitchen. On the other hand, you can also opt for a shared kitchen room if cost-saving is your priority.
Licenses to Run Cloud Kitchen
There are plenty of legal obligations that must be followed before establishing a cloud kitchen. Getting a food safety license on board can help you create a sense of satisfaction among your potential customers. To encourage more clients to buy from you, make sure to add the said license on the website as well.
What are the Basic Licenses that you would require to run the Business of Cloud Kitchen?
Getting licenses and registrations is mandatory for opening such a type of business. The given section will show the number of licenses you would be required to run the cloud kitchen business.
Food Safety License
All food-related business or FBOs (food business operators) has been mandated by the authorities to obtain FSSAI license. The license issues by FSSAI come with a flexible validity period that ranges from 1 to 5 years and ought to be renewed before expiration. It would be beneficial for the business owner to add the FSAAI logo on their offering the boost the confidence among their target consumers.
GST Registration is compulsory for the business entities in India and also it is advisable to file business-related taxes on time. GST ought to be submitted weekly, quarterly, and annually. Goods and Services Tax can give access to licensed vendors, as it minimizes the tax value if all the parties have a GST number. After opening a bank account, one can apply for a GST number.
Every business is required to obtain a trade license, and cloud kitchen is no different here. One has to approach the local municipal office with relevant documents to avail of the trade license.
Fire and Safety License
A workplace with a Fire and Safety license renders assurance regarding human safety. Obtaining a fire license is a must-have requirement for those who intend to apply for a trade license. FIR NOC reflects that the company has incorporated the required safety precautions and measures for protecting people in the work premises against any hazard.
There is no denying that popular brands are vulnerable to duplication. Many entities try to repeat their success just by copying their logo, market strategies, and even their marketing channels. This shouldn’t be a worry for companies that already have a strong market presence but for new entrants it is matter of serious concern as it could jeopardize their dream of building a solid brand.
Therefore, trademark registration is rather an absolute necessity. Obtaining trademark registration can put your business beyond the reach of defaulters who strives to hamper the brand credibility through duplication. To avail of trademark registration, you must apply the logo, color pattern, and even those intangible elements that you think hold some substantial value and contribute to business success.
Kitchen Equipment & Packaging
To set up a productive kitchen, you must have the right kind of appliances and equipment in place. Also, make sure to procure the said items in ample volume so that productivity doesn’t get hampered.
Staff- Supportive Manpower
Since there would be manpower, the business owner has to look into relevant rules and laws to ensure conformity with the bylaws. Payroll, professional tax registration, wage management, provident funds become an imperative part of the business. In a nutshell, cloud kitchen owners are not too proactive about creating salary account or PF for their manpower. It should be avoided if you are expecting to transform your business into an established and successful entity.
Generating Online Orders &Marketing
The cloud kitchens don’t necessarily offer dine-in facilities as they utilize online and telephonic channels to generate food orders. It limits their exposure to the general public from the advertising viewpoint. Therefore, it becomes a necessity for these business types to use online marketing channels to promote their offering. You can take advantage of the following mediums as they are the best sources for the business promotion
1. Online Food Aggregators: You can list your business on Online Food Aggregators.
2. Promoting your business on Online Aggregators
3. Search Engine Optimization (SEO)
4. Social Media Marketing
5. Loyalty Programs & SMS & Email
To be precise, the cloud kitchen is not a risky business considering the recent trends. Even in the initial stage, business owners can earn ample profit through the right strategies and promotional techniques. Additionally, compliances applicable to this business model is not so stringent, which makes it the most suitable business alternative for the new entrepreneurs.