Ghost kitchens could be a $1T opportunity: Euromonitor

The facilities will help make delivery cheaper and faster, taking share from other models, the researcher said.
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Ghost kitchens, or facilities that produce food for delivery only, could create a $1 trillion opportunity for food delivery in the next decade, according to a recent webinar by market research firm Euromonitor International.

That’s based on the idea that the spread of ghost kitchens will result in lower food costs and faster delivery. As consumers increasingly turn to that service, it will take share from other foodservice models such as the drive-thru and even the packaged goods market.

“As you see costs start to go down, and as you see delivery times start to go down—because again, building new ghost kitchens … can help reduce the time it takes for food to reach people—that’s when you start to see some really interesting numbers,” said Michael Schaefer, Euromonitor’s global lead, food and beverage, on the webinar.

The firm predicts that by 2030, food delivery could account for up to a third of consumers’ $3 trillion food spend globally. That includes roughly 50% of drive-thru business, or $75 billion, and 50% of takeout, or $250 billion. It will also take share from frozen meals (35%),  packaged cooking ingredients (30%), dine-in (25%) and packaged snacks (15%).

Among those, the drive-thru is the area to keep an eye on, Schaefer said. 

“The real bellwether post-COVID of how much ground delivery is gaining is what happens in the drive-thru realm,” he said. If drive-thru traffic starts to decrease in places like the U.S., where the drive-thru is extremely popular, that’s a sign the scales are tipping toward delivery, he said.

Ghost kitchens had already been catching on when COVID-19 hit, and the pandemic has only accelerated their development as dine-in service is limited and consumers seek more off-premise options. 

Wingstop opened its first U.S. ghost kitchen last month, and brands such as Famous Dave’s, Dog Haus and others have accelerated plans for ghost kitchens since the pandemic began.

Because they are not consumer-facing, the facilities require fewer employees and can be located in areas more optimal for delivery. That can help reduce food costs and delivery times.

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