September 29, 2020
Original Article LINK
We’ve talked about cloud kitchens extensively this year, and for good reason. The “foodtech” innovation is one way the F&B industry has managed to keep its head above the water during these tumultuous times. Serving mainly the smaller food brands, namely MSMEs, cloud kitchens do away with the costs of having a brick-and-mortar location by having a “ghost” kitchen that operates behind closed doors.
The latest local cloud kitchen on the scene is Kraver’s Canteen.
Kraver’s offers brands the chance to set up shop in one of their kitchens, advertise on their platform, and deliver their food through Kraver’s delivery partners. It’s a one-stop shop for small restaurants focusing on expanding their online presence, something that has become crucial for the survival of the industry.
We had a quick chat with Victor Lim, general manager of Kraver’s Canteen, about how cloud kitchens began, and what the future has in store for cloud kitchens and the food industry.
ESQUIRE PHILIPPINES: How did the idea of Kravers get started?
VICTOR LIM: [We] basically started when some of our founders/co-founders got together to discuss how to bring an imported milk-tea franchise to the market here in the Philippines. Instead of going the traditional route of opening a bunch of stores and dealing with a lot of capital and expenditure, we started talking about how to potentially operate it online only, which got us thinking about other models that can operate purely online.
Other industries can do it (as demonstrated in the creation of thousands of marketplaces and online businesses sprouting up), so why wouldn't the same be true for food? From there, the ideas just kept escalating and the opportunities kept presenting themselves, which is how our business snowballed into what it is today.
ESQ: How does a cloud kitchen differ from delivery apps?
VL: When it comes to cloud kitchens vs delivery apps, the easiest way to think about it is evolution part 1 and part 2: ever since Uber launched UberEats (which then was acquired and converted to GrabFood) and players like foodpanda entered the market, the way that customers order food for delivery has radically changed.
The aggregators (Uber/GrabFood/foodpanda) revolutionized the way customers engage with restaurants and created an entirely new market for the food delivery segment. Now that the execution part of deliveries is fully at scale, the next step in food evolution is cloud kitchens, which focuses on improving and optimizing the execution component of food—we optimize the way food is actually produced and released into the market—specifically focusing on the newly created food delivery market.
There's a lot of upsides to operating cloud kitchens, like lower costs, lower risks and lower commitments, and the only downside is that it doesn't capture dine-in customers, which was already trending down even pre-COVID.
ESQ: How do you think this will help the F&B industry get back on its feet?
VL: I truly believe cloud kitchens are the future of food. Cloud kitchens are going to help the F&B industry get back on its feet by offering affordable, cost-effective solutions for food businesses to continue operating, and give a real opportunity for aspiring food entrepreneurs to leave their mark in the Philippine food scene.
The food industry has already been democratized by the aggregators like GrabFood and foodpanda, so it's no longer about which franchise has the deepest pockets to expand offline—it’s about which brands can offer the best value and service for their customers. We're taking that idea one step further by removing even more barriers to opening up food concepts, where we can support service, configurations, and even financial startup.