July 15, 2022
Host kitchens are coming up on the food scene and could be a lucrative new endeavor for restaurateurs. So, are host kitchens profitable and how do restaurant owners get started with their host kitchen? We explore those questions and more.
What is a Host Kitchen?
It might be easy to confuse ghost kitchens and host kitchens; however, there are a few key differences to help keep them straight.
You might already be familiar with the concept of ghost kitchens, food prep operations set designed with off-premise dining in mind. These kitchen facilities are set up by a brand and to serve that brand’s own food. The operations have no public presence and only serve customers on food delivery apps.
Like ghost kitchens, all host kitchens’ meals are designed for off-premises consumption and operate out of an existing commercial space. However, host kitchens offer their under-utilized culinary spaces to prepare a third-party brands’ food instead of their own while profiting from the sales.
Why Host Kitchens are the Next Big Thing
Owners can utilize their existing staff, equipment, and space to produce an established brand’s menu alongside their own. Essentially, one single kitchen space can serve two distinct menus and reach more clientele without increasing labor or rent costs. Plus, since the food is consumed off-premises and relies on delivery, you can tap into online food ordering trends, which is anticipated to grow by 20 percent in the next three years.
How Profitable are Host Kitchens to Restaurants?
When considering starting your own host kitchen, it’s imperative to consider potential profitability versus expenses.
- No Increased Rent: Since host kitchens run out of existing, functioning spaces, there's no need for a host operator to incur any new rental or building payment fees.
- Zero to Low Overhead: There are few additional operating costs to run a host kitchen. Using similar ingredients across menus and buying in bulk from a restaurant supply store can keep food costs down.
- No Added Labor: With the current labor shortages, restaurants are looking for ways to bring in sales without a large workforce. Host kitchens do not require any additional labor, mitigating the need for hiring and training new staff.
Host kitchens are excellent ways to tap into extra revenue streams and bring in additional revenue. Restaurants that choose to operate host kitchens bring in roughly 10 to 20 percent more in sales annually.
Want to Expand Through Host Kitchens?
Are you looking to tap into more revenue streams with a host kitchen? There are a few ways to ensure success.
- Consider your location and demographic. Before deciding on which brand you want to host, do some R&D. Look for menus that are not readily available in your area, but that work for your neighborhood demographic.
- Choose a brand that works for your kitchen. Keep your expenses lower by partnering with a brand that is easy to execute. Think about the size of your space, the proficiency of your culinary team, and your staple ingredients. Find a brand that fits seamlessly with your business.
- Work with a host kitchen company. Teaming up with third-party businesses that match host kitchens with brands can help you find the best company to partner with.
Stock Up on Restaurant Supplies and Save
US Foods CHEF’STORE provides all our restaurant partners with everything they need–from fresh produce to wholesale meats, eco-friendly packaging options, and more! Our shelves are lined with exceptional products, perfect for any menu. Stop by one of our many locations to see how we can help.