Dive Brief:
- Chick-fil-A began delivering out of DoorDash Kitchens in Redwood City, California, in early November, Nation's Restaurant News reports.
- The chicken sandwich chain has locations in San Jose and Sunnyvale, but with the shared kitchen space can deliver to seven additional markets in the Bay Area.
- The move into DoorDash Kitchens is part of the company's strategy to provide more access to customers. The company has been exploring different food delivery services nationwide since 2018, Luke Pipkin, Chick-fil-A's Beyond the Restaurant senior project lead, told Nation's Restaurant News.
Dive Insight:
The momentum of kitchen-only concepts is building faster with Chick-fil-A's partnership with DoorDash Kitchens, the latter of which just opened in October. The fast collaboration signals potential success the chicken chain has had so far experimenting with the business model.
In October 2018 Chick-fil-A opened its own catering and delivery-only locations in Kentucky, which has helped the company free up its in-restaurant staff from having to fulfill these orders. Then in the first half of 2019, it partnered with growing virtual kitchen company, Kitchen United, according to Business Insider.
As for DoorDash Kitchens, its newly minted to-go only virtual kitchen gets a boost from the prominent brand, giving weight to its efforts as it fights for its corner of this new market. Kitchen United is likely the biggest competitor in the space. In addition to its own Chick-fil-A partnership, Kitchen United has Sweetgreen and The Halal Guys on its client list.
Demand for space in existing virtual kitchens is high, and many delivery providers and others are clamoring to offer more space. Kitchen United plans to open 400 of its shared-kitchen locations in the coming years, and received $40 million in funding from a real estate company to help its growth in the New York and New Jersey area. In addition, former Uber CEO Travis Kalanick's CloudKitchen concept gained $400 million in January to help with its expansion. Competition also comes from former Uber employees, who launched a startup called Virtual Kitchen Co. and has garnered $15 million in funding so far. So DoorDash Kitchens has its work cut out for it if it wants to make differentiate itself from the growing pack.
In addition to DoorDash Kitchens, the industry can expect even more expansion of ghost kitchens, especially since demand for meal delivery isn't slowing down and several other restaurant brands continue to experiment with the concept. Starbucks is testing virtual kitchens in China through its partnership with Alibaba and could bring similar models to the U.S. It just opened up a pickup only store in Manhattan, for example. Famous Dave's, Wetzel's Pretzels, Dog Haus and Outback & Carrabba's are testing virtual kitchens as well. Even celebrity chefs and lifestyle brands have turned toward delivery-only concepts as a promotional tool.
Michael Schaefer, Euromonitor global lead for food and beverage, told Restaurant Dive that infrastructure like virtual kitchens and drop-off points will be necessary to take delivery to the next level. In areas like India, Indonesia and China where delivery has grown the fastest, there has been a lot more movement with ghost kitchens, he said.
