As consumers embrace delivery services, restaurants are ditching their eat-in spaces — and finding big savings.
Dog Haus is the kind of place designed to spend time in. It serves dogs, burgers, beers, and the like, and its wide-open space captures the vibe of a beer hall — industrial but clean, with high ceilings, wall-size graphics, reclaimed-wood-and-steel tables, and music trendy enough to draw in young customers. The first time Jesse Koontz checked it out, he wanted to spend more time there, too. “I just immediately fell in love with the concept,” he says. “I walked in and was like, ‘This place is cool.’ ”
Koontz set out to become a franchisee, and in 2018, he opened his own Dog Haus, now one of 34 spread across 10 states, in Chicago’s Lincoln Park. Shortly after he opened it, Koontz started thinking about a second location. He wanted one closer to downtown Chicago, where foot traffic is especially high. But the cost gave him pause. A full Dog Haus launch can cost more than half a million dollars. Did he really want to take another gamble that big?
What he really wanted was a way to test the market first. Then he realized he could — but it would require ditching almost everything Dog Haus is known for. No high ceilings. No art on the wall. No tables where customers could sit and snap Instagram photos of their pastrami- and arugula-piled dogs. In fact, no way for a customer to spend any time there at all, because there wouldn’t even be a front door for them to walk through.
Instead, Koontz would open in what’s come to be called a “ghost kitchen.” Most consumers never see it, or care about it, or even know about it, but it’s there — a place that produces food and, just maybe, will also produce the future of the franchise food industry.
That demand for on-demand food has created a major shift in spending. In 2017, U.S. food delivery was a $43 billion market. By 2022, analysts expect it to hit $76 billion. That’s a projected 77 percent growth in just five years — and to fill that demand, restaurants will have to rethink the ratio of griddles to tables. That’s why many of them, Koontz included, are turning to ghost kitchens. They’re a logical answer to the question: How can we best serve customers who aren’t even walking into our restaurant?