Commentary

Kroger, Muscle Maker Expand 'Virtual Kitchen' Concept

The virtual or “ghost kitchen” space—off-site preparation facilities for restaurants’ delivery meals—just got more crowded with the entry of grocery giant Kroger in its latest partnership with meal prep and delivery provider ClusterTruck.

The deal marks the acceleration of a trend that began well before the onset of COVID-19 and will make things more competitive for casual and fast-casual restaurants embracing the virtual meal prep business.

The nation’s largest grocery retailer, The Kroger Co., has launched two on-premise kitchens at stores in Indiana and Ohio. Late last year, the company collaborated with ClusterTruck—which operates its own kitchens and delivery trucks—to open a freestanding ghost kitchen in Carmel, Indiana.

Kroger is repurposing 1,000 square feet in its two stores where ClusterTruck staffers prepare meals for delivery and in-store pickup.

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The initiative is designed to meet “the sustained customer demand for quick, fresh restaurant-quality meals, especially as we navigate an unprecedented health crisis that has affected every aspect of our lives, including mealtime,” Dan De La Rosa, Kroger's group vice president of fresh merchandising, said in a release.

Ohio-based foodservice consultancy Foodservice IP noted in May how, barely two months into the pandemic, COVID-19 had “accelerated widespread demographic use of delivery and takeout through mobile devices. This means the number of brick and mortar restaurants will be reduced while centralized production centers will be emphasized.”

More recently, Foodservice IP managing principal Tim Powell told Nation’s Restaurant News: “As the demand increases for virtual stores, we will start to see sit-down restaurants, especially casual dining, disappear unless they can find a new way to innovate.”

A long list of casual and fast-casual restaurant chains—among them Applebee’s, Chili’s, Nathan’s Famous, Cracker Barrel, Chuck E. Cheese and Ruby Tuesday—have been experimenting with virtual kitchens. Such outsourcing enables them to better monetize their real estate and staff costs at a time when in-house dining has been severely restricted.

Last month, restaurant parent company Muscle Maker Inc. announced it will open two new ghost kitchens in Manhattan and Brooklyn for its Muscle Maker Grill, Healthy Joe’s and Meal Plans AF food offerings.

The unit in Manhattan’s Tribeca neighborhood will operate not only as a ghost kitchen but also as a place where people can sit and dine after picking up their orders.

The delivery-only Brooklyn kitchen will be located in the Williamsburg neighborhood.

“With a median age of 30 years old, Williamsburg demographics are favorable to both our product offering and the delivery-only model,” Muscle Maker Inc. said in a release. “Healthier lifestyle practices trend heavier within this age group and we believe the neighborhood is ripe for healthier food options.”

Brick-and-mortar restaurants are not the only ones embracing virtual meal prep and delivery.

Today, health-and-wellness food brand TB12—co-founded by NFL star Tom Brady and business partner Alex Guerrero—announced a partnership with subscription and delivery meal service The Good Kitchen.

New TB12 Performance Meals come in 12 varieties and are shipped by The Good Kitchen fully prepared and frozen.

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