on the money entrepreneur
Explain how your kitchen works in terms of sharing costs, labour, supply etc.
Imagine a shared working space like WeWork. Brands come in and get incubated until they can go off on their own steam. In a way, it works the same here. We have three young food brands under one roof, we share all the equipment, staff and raw ingredient costs. We split the overheads, irrespective of sales for the month (mostly because they are more or less the same).
Other than reducing overheads, what are the other financial and strategic wins?
Split overheads and running costs, and your brand suddenly seems a lot more viable. In a mall you would be paying a lot more on rent based on the premise of high foot traffic; online deliveries would simply be an added benefit. Our location is pretty central, so we have the benefit of reaching the (pre-Covid-19) Sandton corporates without the Sandton City rental. Our staff end up being super-efficient and productive as they know the menu and prep of all brands, and don’t often sit around with nothing to do. Our equipment is communal, so we share extractors, stoves and walk-in fridges with specific sections to store and cook different proteins and produce. We have a great working routine with pre-service prep and service times so that everything runs smoothly.
With having no ‘store front’, what are some of the unique marketing challenges? The only negative to this business model is visibility, which is easy enough to circumvent with enough targeted advertising and, even better: word-of-mouth. I think it is especially prevalent now, but brands need to be top-ofmind all the time. People are also spending more time at home, less time driving around and in stores. So targeted ads and a good selling platform are key here. Visibility and reach are why we decided to build our own web platform to offer meal packages around the whole of Gauteng.
Photos: Supplied
Was the decision to launch the website based purely on the need to increase revenue streams due to the lockdown?
Initially, yes, it was largely based on making sure we targeted every route to market we saw available, as well as keeping the margins up (i.e. reducing the commission costs of third parties). Even when things go back to (the new) normal, why would restaurants not consider an online platform? It’s really just another avenue for revenue generation and a @finweek
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convenient method of getting food into a home that is not generally within the immediate neighbourhood of the restaurant.
What will be available on your website?
It will be a one-stop shop for health and nutrition. We are creating fresh food packs that are goal-orientated – lose weight, gain weight, build your own etc. Jake and I are all about fresh food, and we are trying to steer away from frozen food as much as possible like other brands are accustomed to doing. Having said that, we recognise the convenience of this and will incorporate it with a creative spin. Admittedly, there are others that have created such offerings, but our food offering is fresh and new. We’re incorporating shakes and fresh juices as well as a pantry section. With the pantry section our aim is to include smaller niche health brands of grains, coffees, chocolates as well as the Metalab supplements. Everything South African and locally produced.
Ghost kitchens aren’t for everyone, but Covid-19 has exposed the need for flexible rental agreements. What needs to change going forward? I think landlords need to realise that retail is not what it was, and the structures of their leases need to reflect that. It is to their benefit that they encourage entrepreneurship and make sure that the brands they sign on as tenants survive, as it is these brands that drive traffic to their malls. Leases should be turnover-based, and 12- to 24-month contracts with 6-month break clauses. Then it is in the interest of the landlord to drive traffic as much as it is in the interest of the brand to offer a great product. I hope to see the restaurant retail space change for the better between brands and landlords as this will benefit everyone, including the consumer.
Now is a strange time to make any predictions, but what is the outlook for your industry?
It is a difficult time for the entire industry – barmen, waiters, chefs, cleaners – it’s these people who I really feel for. Places that were once institutions are closing all over the place. I think it is going to take some creativity and balls to think outside the box and make sure brands weather the storm. People are going to be eating out less from now till who knows when, so it’s about bringing them the product, and essentially the experience. ■ editorial@finweek.co.za
Tom Shackle CEO of Darth Kitchens
A force awakens
Darth Kitchens, a dark (or ghost) kitchen in Cape Town’s CBD, has developed and launched eight brands over the past year. And while the lockdown has affected food delivery numbers in South Africa, Darth Kitchens CEO, Tom Shackle, believes the delivery-only model as premised on the virtual kitchen concept will become more popular in SA. “The market for food delivery in this country is growing fast. The lockdown in this country has affected those numbers, but with delivery being one of our only options these days, the customer is provided with a quick, simple option to get food, while staying in the comfort of their own home. Given the rise of the need for convenience in the market, food delivery in this country is following a similar trajectory to the trends we’ve seen internationally. With that, I foresee the dark kitchen model becoming exponentially more popular.” And while the lockdown has put Darth Kitchens’ expansion plans on hold, there are still “scaling plans on the horizon for when the current circumstances calm down, and we’re looking forward to expanding our footprint into other areas”. ■
finweek 25 June 2020
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