Business Environment

Cloud Kitchen in Indonesia

2020/06/26

インドネシアのクラウドキッチン事情【Grab KitchenとGoFood Kitchenの2強を中心に成長する新しい市場】

Current Status of Cloud Kitchen in Indonesia

Cloud Kitchen (Satellite Kitchen) is a business where restaurants without Eat In (Dine In) space and no take away service, but only deliver them on a smartphone app.

Grab Kitchen was the first to open 40 stores in Indonesia, but GoFood Kitchen, which was created as a joint venture by combining the know-how of India's Rebel Foods with GoJek's big data on the complexity of the Indonesian market and SME commerce, is on the side of the chase with 20 store openings (as of February 2020).

In the same online sales business, but unlike general merchandise sales, food delivery requires a location strategy that is tailored to the consumer market, and just like real stores, the concept of "branching out" is important, and Grab Kitchen is currently available in five major cities in Indonesia.

Criteria for selecting a cloud kitchen location

  1. The ability of the partner to be closer to the consumer, taking into account delivery distance
  2. The ability to meet more of the surrounding consumer's needs in one collective kitchen

GoFood Kitchen was launched at the same time as the GoFood Festival, which is set to close next month, and does not charge space rental fees to its partners, but instead takes a full commission from sales.

The quality of service could be compromised if individuals are able to use their home kitchens to run a cloud kitchen business, so the screening process for joining GoFood should be based on having a kitchen in a commercial space that is not your home.

The Future of Cloud Kitchens in Indonesia

In general, the most important factor to consider when opening a restaurant is the location, but if we become a partner of GoFood Kitchen or Grab Kitchen, we will be able to open a restaurant in the most strategic location, which has been selected by GoJek and Grab, the decacorn companies, using all the information available, so that the partners can compete purely on the quality of food taste and hygiene.

Benefits of the Cloud Kitchen

  1. Basic amenities such as kitchen, water, drainage system, electrical lines and gas lines are provided, which reduces the rent and renovation costs of the store.
  2. As a delivery-focused business, you can use GoJek and Grab's existing delivery methods to reduce operational costs.
  3. There is no upfront payment of rent, which accounts for a large percentage of fixed costs in the restaurant business.
  4. It is easy to get a fixed, repeat customer (langganan) because of the speed of delivery from the time the order is received on the smartphone app to the time of delivery and the guaranteed customer service other than the food.
  5. The ability to use GoJek and Grab's cloud kitchens when expanding to other cities guarantees the best location and provides the best service from order receipt to delivery.

In Europe and the U.S., people tend to cook at home rather than order food from outside, but in Southeast Asia, including Indonesia, the younger generation is not afraid to order food from outside, so I think there is a high possibility that convenience-oriented, on-demand based services will grow further.

Also, from the perspective of Indonesia's national character, there are a lot of people who "love gaps" and "success stories," just as many entertainers were born from amateur singers in the 2000s with the AFI (Akademi Fantasi Indosiar) and Indonesian Idol.

So, if GoFood and Grab come up with a project to discover talented people who can make delicious local dishes and ordinary home cooking that are buried in the countryside, I think it will be a nationwide success.

The idea of a cloud kitchen is that individuals who don't have a physical store can start a food and beverage business by renting a kitchen, an online ordering system, and a set of deliveries, but isn't GoJek the only one in Indonesia that can offer these three things at the moment? twitter.com/kompascom/stat…
Grab Kitchen was ahead of the crowd kitchen with 40 locations and GoFood Kitchen was on the chase with 20 locations (as of February 2020). Moreover, the locations are tailored to the distribution of the target consumer and are commission-based with no space rental fees.
katadata.co.id/berita/2020/02… twitter.com/yamazou/status…
I think it would be a lot of fun if they gave the winner of the "Master Chef Indonesia" competition the opportunity to open a cloud kitchen, like the "Gachinko Ramen Road". Like the Indonesian dream where Ibu, who is an insanely good cook from downtown, becomes a star koki.
dailysocial.id/post/gofood-cl… twitter.com/yamazou/status…

In this way, Cloud Kitchen is a business model that has the potential to revitalize the Indonesian food and beverage industry and grow the market, while at the same time supporting self-reliance by providing opportunities for small food service providers and housewives to start their own businesses with little capital.