The concept of Cloud Kitchen Business has been rapidly gaining popularity in recent years. It became trendy, especially with the rise of food delivery services and the impact of the COVID-19 pandemic on the restaurant industry.

Starting a successful Cloud Kitchen Business in 2024 is not a big challenge if you follow the proper guidelines. There are very small mistakes people make that become barriers to making their cloud kitchen successful. Ensure you learn and get proper knowledge before entering the food business. The following 3 concepts & 10 actionable steps are being used by top cloud kitchen owners, who are making Millions of revenue per month.

3 Concepts of Cloud Kitchen Business

1) Less Is More

In the business field, there is a concept called ‘less is more’. This concept affects directly psychologically. In the cloud kitchen business ‘less is more’ is very much applicable in naming, brand establishment, or menu. The fewer menu items, the easier it is to sell food items. The business name should also be very crisp and short.

2) People Buy Brand

People buy brand from you, not only foods. Apparently, it seems that people pay only seeing your money. But in today’s digital age, consumers have access to an abundance of food options. So building a strong brand identity is important for standing out in a crowded market. It includes creating a unique brand name, logo, services, food, and visual branding that resonates with your target audience. It doesn’t mean you’ve to set up a million-dollar food brand. You don’t have to. You just need to position your food business as a BRAND. Even from home, you can start a brand.

For example, ‘Tiffin Centre’ doesn’t look like a brand, it is very generic. Whereas ‘Tifiin Affairs’ looks like a brand.

3) Build CFL (Customer For Life)

People are often worried about not getting customers when starting their cloud kitchen business. Few of them ask “How many customers are needed in the first month to get profitable?”. You don’t need thousands of customers in the first month. You just need 100 customers who are your fans. You need to make those customers impressed by your food quality, service, packaging etc. These will be the loyal customers who will repeatedly order from you in a single month.

10 Most Important Tips To Run A Cloud Kitchen Business

1) Choose A Micro-Niche

Ask yourself “What is the food I will be known for as a brand?”. You’ve to ask yourself this question before even setting up your business plan.

Such as –

Domino’s is known for Pizza

KFC is known for Fried Chicken items

McDonald’s is known for Burgers

Pizza Hut is known for Pizza

Subway is known for Sandwich

Don’t go for North Indian cuisine, South Indian cuisine. These are very generic, large menus. It doesn’t give clarity to the customers on what food you offer. Choose a very specific micro niche for your cloud kitchen business. The reason behind choosing the micro niche is that the customers assume that this item of yours is the best in the locality. It builds your power to dominate the specific market.

2) Micro Targeting

In 2024, if you are going to sell your food to everyone, then you are selling to no one. Follow this strict rule if you are willing to stand out in the cloud kitchen business.

Choose a specific customer set, whom you will target. You will run your marketing campaigns targeting them only. Such as –

There’s a food brand called ‘Lunch Square’ in Bhubaneswar. The owner of the business, Brundaban Mishra started this brand targeting only corporate employees. He contacted every HR of the corporate offices of his city and he offered them lunch thali at a very affordable cost. Even during the worst month, he made Rs.1 Lakh in a single day. That’s the power of micro-targeting.

Once you become the King of a specific single target market, you can target other customer sets accordingly.

3) Micro Researching

The success in this cloud kitchen business depends upon your micro-researching ability. It will help you in deciding sellable menu & brand positioning.

There are many ways to do the research work for your cloud kitchen business. One of the ways is leveraging Swiggy & Zomato. Go the their app/platform and see the menu of your competitor brands. See which foods those brands are selling. List down all the bestselling items. Don’t copy their items, as it will not make you unique. Try to curate your menu items and keep similar types of items (inspired by their bestseller items) in your menu. That will ensure the high selling of your menu items.

4) Create Survey and Discount Offers

Before launching your cloud kitchen business, running a survey is a very important thing to do. It will also help you in your micro research.

Create a survey form and distribute it in your locality. You can simply ask them while distributing the form – “Hello Sir/Ma’am, we’re launching our food brand. Please fill out the form. It will help us to know what food you miss, and which food we should bring for you.”

After filling out the survey form, give them a special discount coupon and say “Once we launch a discount will be there for you”. It will help you to get customers on the very first day of opening your cloud kitchen brand.

5) Run Crazy Offer

Running a crazy offer while starting your cloud kitchen business is not optional, but rather a necessity. A crazy offer is the type of offer that a customer can’t refuse.

Suppose you are offering 2 Regular Pizzas @ Rs.99 for the first week of opening. Isn’t it the CRAZY? People will give it a try. It will solve the problem of low sales in the opening week.

For example, Amol Agarwal from Kolkata applied this tip. He got 75 orders of burgers on the very first day of opening his cloud kitchen business.

6) Multiple Sources of Income

People often list their food items on Swiggy & Zomato and sit back. Whatever order comes from there, they think that’s enough. But the point is, these aggregator platforms charge too much commissions and you see minimal profit of yours. And maybe you’ll hardly see any profit. That’s unfair, right?

To solve that, create multiple sources of income. Don’t depend only upon Swiggy & Zomato. Use digital marketing (online marketing), pamphlets, flyers, and flex to get orders. It will give you more control over your sales. With digital marketing, you can decide from which location you want to take orders.

You can also take bulk orders (party orders, birthday orders, etc.) from customers. The goal is to open multiple channels to receive money.

7) Chefless Model

Obviously, we should respect chefs, but we can’t ignore cloud kitchen business owners also. As a food business owner, the control of your business should be in your hands. But often business owners become dependent on chefs. Chef thinks that the business is running because of his expertise only and charges more salary. As you’re being dominated, you agree to their words and increase their salary. Sometimes they give threads to leave their job demanding unethical demands.

To solve this problem, introduce the Chefless Model. It removes the dependency of any specific chef in your business. Just write all the necessary steps in sheets and make a format. This will be followed by every chef when they’ll cook something. As cooking is a chemical process, whoever will cook the taste will be the same.

8) Micro Menu

One of the biggest mistakes people make by having a large menu. In this cloud kitchen business, your menu should not be like a book. Otherwise, people cannot decide what to order and will end up not ordering from you. They will simply swipe up.

As a cloud kitchen business owner, your target should be creating a crispy micro menu. A complicated long menu creates confusion. But a small menu increases the probability of ordering from you. Also, your wastage of food will be very low. Your cost will be low and the profitability of your business will increase.

9) Fast Delivery

Before even the cloud kitchen business was introduced, it was possible to make customers wait for food in restaurants. You could have said sorry for being late and served them food. But in this era of cloud kitchen business, you don’t have any options. But customers have lots of options. If you’re late in delivering food, customers will never order from you next time.

For example, people many times choose Domino’s over Pizza Hut, because of the delivery time.

10) Multiple Levels of Customers

Suppose, you spend Rs.200 on marketing costs to acquire a customer, food costs will be different. It may seem like you burnt Rs.200. But think, you’ve data of that particular customer. The game is all about data. The more data you have, the more you can approach them with different offers.

If you have data of 10,000 targeted customers, you can easily cross the revenue of Rs.1 Crore. You can approach them multiple ways – monthly repeated orders, bulk orders, subscriptions, etc.

The game of cloud kitchen business is all about strategies, marketing & proper planning. If you want to know the requirements & beginner’s guide to start Cloud Kitchen – read this.

FAQs (Frequently Answered Questions):

1. Can I start Cloud Kitchen Business from home?
   • Yes, you can initially start cloud kitchen from home with all basic requirements & legal documents. But after being profitable, you should shift to commercial place.
2. How many customers do I need in the first month?
   • You need only 100 CFL (customer for life) in the very first month of launching.
3. Is Swiggy & Zomato enough to get customers?
   • No, you should do online & offline marketing to acquire more customers. Then only you can get more profits in this business.