A Study on the Prospect of the Cloud Kitchen Model in Dhaka

Abstract

This study looks at the prospect of the Cloud Kitchen Model (CKM) in Dhaka, Bangladesh. Cloud kitchen is a centralized commercial food production facility with no dine-in facility. The study first identified the existing perceptions and expectations of the critical stakeholders for whom the CKM can potentially bring competitive advantages over traditional brick-and-mortar-based models. The target audiences for this study are consumers of online food delivery systems, traditional restaurant owners, potential CKM restaurant owners, and industry experts. To perform this mix-method based study, the researchers conducted surveys along with Focused Group Discussions and In-depth Interviews targeted to various stakeholders such as consumers, restaurant owners, and industry experts besides utilizing secondary data sources. Most respondents know about cloud kitchens, and primarily most of them heard from social media, but mere knowledge of the CKM does not influence their ordered food preference. The only time consumers showed a greater preference for CKM over traditional brick-and-mortar models is when the comparison comes mostly in terms of price, quality, and packaging. As per the results of this study, for the restaurant ecosystem of Dhaka, CKM offers a narrow sales prospect for the next three years even though it offers Value Added Tax (VAT) benefits in general. Existing restaurant owners perceived immediate additional capital requirements, other than their available capital in hand for running their existing restaurants at the moment, as a barrier towards entering the cloud kitchen business and thus stopping the adoption of CKM in the next three years even though they are interested to initiate CKM. It is recommended that those who want to start a CKM business should proceed with a robust business model and can look for angel investors or venture capitalists to secure funds and add experts to the business while prioritizing their marketing activities. CKM-based restaurants should utilize social media platforms to build a positive brand image. Finally, CKM-based restaurants should focus on consumer needs through customized platforms (e.g., their own delivery media and websites) and emphasize employee retention through proper employee training and benefits.