 Today, I'm going to be showing you how to build a cloud kitchen. With all the pandemic going around, cloud kitchen is definitely your best bet and I'll show you exactly why that is the case and how to do it. So make sure you guys stay until the end and make sure that you guys subscribe along the whole journey. Hey guys, this is Wilson here, your friend in helping you build a profitable restaurant. This is by far one of the most asked questions that I get within my email. How do you start a cloud kitchen, Wilson? And that's the reason why we're shooting this video for you. Now, for us to show some appreciation for our loyal fans, these two individuals, I love to highlight them for their kind and encouraging words. And that's the community that I want to be able to create. So make sure that you guys leave us positive comments in the comment description below. Now without further ado, let's dive right in. The number one thing that before you start anything, before you go ahead and commit to anything is to know your customers, know exactly who you want to serve because someone that is a family, they would require something completely different. They want something that is a big, stewie kind of stuff versus a Jim Ratz and someone that always goes to the gym. The types of food that they offer is clean, well, protein and healthy stuff that they are looking for to a couple that wants to be whined and dined to indulge in goodness. And that's a very different clientele altogether as well. So it is up to you to actually fine tune and know exactly who you want to serve in order for you to come up with a food concept, in order for you to come up with the menu offerings, in order for you to come up with all the marketing tactics is to know exactly who you are to serve before you decide on your food concept. That's one of the biggest mistakes that I see out there that people are making is that they come up with a food concept. They think that this is an amazing idea that, wow, I have amazing chickens stew that I want to be able to serve to the public, but not really understanding who is it that they want to serve to. So understanding who your customers is is definitely by far the number one crucial step that you need to take. The second step in starting your cloud kitchen is choosing the right concept. Now how do you choose the right concept? The first step of that is to find out what your customers are really, really looking for. Now how do you even do that? Well, you can actually go online and actually do some Googling. First of all, it's to understand, hey, you know what? If I want to sell to someone that is really, really health cautious, that always goes to the gym. What are they looking for? What did they usually eat? What is their cuisine like? You can go on different forums. You can go on Facebook group and actually check how their dietary preferences are like. And by you doing these research behind the scenes now, you can actually come up with concepts that really cater to the core fundamentals of what they're looking for. And then you can wind and dine it. You can dazzle it up, repackage it in order to create your own very concept for the food cloud kitchen. Next, it's for you to actually study your competition, see what they have that is selling as super, super popular, see what they're not serving, see what is not serving well and really understanding why is these items serving really, really well because majority of the time, the reason why they're selling these items a lot, there must be a reason why because probably it's in super high demand. Understanding your competition is also key to your success because it allows you to understand, hey, you know what, these guys are selling these donuts and they're doing an amazing job because they're gluten-free. Then therefore I can sell the same type of gluten-free donuts, but I have my own twist to it and that itself allows you to differentiate yet also tap into something that is of a high demand. You would always want to be able to position yourselves in the middle of a waterfall. All these traffic coming through and you're just standing there absorbing all the traffic. You don't want to be in a pond with no traffic. It doesn't matter how big your net is, you probably won't get much traffic and that's the analogy that I love using is to see what is in high demand and be there with your own little twist. Now that you've figured out your competition, it is time to figure out yourself, figure out whether you can actually differentiate and I touched upon that a little bit in my previous segment is to saying that, you know what, you need to differentiate. You need to have your own twist in doing something that is already popular within the marketplace. If you don't like what you're doing, if you hate it, if you don't have passion in it and if you're not good at it, then don't be in this trade whatsoever because you're going to hate it. You're going to be seeing this product every single day. So imagine if you hate it, if you don't imagine if you don't have passion in it, if you're just doing it for the sake of getting money, there are tons of other businesses out there. You don't need to be in the restaurant business. So definitely if you don't have passion in it, if you're not good at it, then make sure that you guys go a different way. But if you're good at it, if you figured out, you know what, this is my twist. Then make sure that you use that as your own taste to differentiate from the marketplace and that's what's going to make you super popular. Now to wrap up everything with how do you choose the right concept is to figure out your finances and your budget. So how do you even figure that out? Go out there and Google cloud kitchen plus your specific city. And then right there and then there should be a few that pops up and actually call each and every single one of them and ask them how much does it cost? What is there? What are the terms like? What are the equipment that are involved? What are the consultation that would be involved as well? And what are the support that is going to be needed and provided as well? By you doing that, you can now forecast how much you're going to be able to spend. Choose the right cloud kitchen that is suitable for your needs. And then that way you can figure out, hey, you know what, I need to budget for six months. This is my budget and that's how you're going to be able to choose the right concept for your food business. Now that we figured out the people that we want to serve to, we figured out the right concept that we want to approach. Now it's time to actually craft the right menu item. Do not, and I repeat, do not have more than 10 items on your menu. And the reason why is because it causes decision paralysis. The fact that you have so many different decisions to make, so many different options paralyzes my ability to choose what is good for me. And thus I would probably go somewhere else because I feel confused. I feel overwhelmed and we don't want to have that feeling for our customers. And which is the reason why we want to have a maximum. Specifically, you're doing cloud kitchen except 10 items maximum. And part of the reason why is also because you don't want to have, let's say 50 different items and prepare a ton of ingredients because if you don't have enough demand to warrant that, then you would also lose up on a lot of spoilage for your ingredients. And that's the reason why having 10 different menu items that recycle a lot of different items and ingredients would help you manage your costs much, much better. An important note to also note when you're creating your food menu is to make sure that they're good for delivery. This is a common mistake that I see a lot of people make is that they create food that is not even good and the qualities and characteristics are not even suitable for delivery such as fries. Who would want to eat a carton of soggy fries? No one would like that. And that's the reason why you don't want to sell fries because not only does it tarnish your brand's name, but it also doesn't give a good experience for your customers. And there is not going to be repeat customers. The key with having a successful cloud kitchen model is have repeat customers. And that's the reason why you should always, always when creating and fine tuning your food concept is to make sure that they're good for delivery. And on top of that, make sure you should start calculating your food costs and cut out the ones that are low in margins that take a ton of time to make because it's all about the volume, right? Creating food items that have high margins, easy to make, which also lowers the production time as crucial to having a good, well-balanced food menu for your cloud kitchen. And last but not least, a pro tip for you is to really pay attention to packaging. Sometimes, cheaping out and ordering that paper packaging might actually cost you much more harm than what it brings you and benefit to save that extra dollar. Because if after 20 minutes or 30 minutes of your food being in this paper package and everything becomes condensated and the water pulls up and then everything is leaking and it just doesn't create a pleasant experience. That itself can turn down a potential repeating customer. In addition to that, choose packaging that is a little bit more shallow than that way when it comes out. It appears that is bigger portion size and thus gives a better perception for your customers. And this is a pro tip that not a lot of people talk about. So do make sure that you take note of this. Sometimes it's counterintuitive to save money on packaging because at the end of the day, your customers are not going to come back. No repeat customers means bad for your business. The next step after you figured out your food concept is to pick the perfect location. Like many, many different things, picking the perfect location is key to your success. The number one feature and the main selling point of operating from a cloud kitchen is the fact that rent is substantially lower than having it at a prime estate. And that's the reason why choosing a location that is lower in rent, perhaps in the warehouse location would be beneficial for your needs. Now, having said that, you do want to be able to choose a location that is accessible to the types of people you want to cater to. So for example, if you're having a cloud kitchen in a place that you're trying to target to office people, yet this location is in the residential location, then that probably isn't the best location for your food concept. And that's the reason why we always say, always your customers first, always understand who you want to serve to first. And that dictates and becomes your compass in choosing the location that serves to the right demographic. So that is a huge thing to consider when you are choosing your location. Next up, we're talking about how accessible your location is, because if your location is 10 floors up with no elevator and it is on the side street with no parking, your delivery driver would never want to go there. And that's the reason why choosing a location that is easily accessible for drivers is also really key. Choose a facility that treats the driver as well and thus the drivers will treat your product well and deliver it into your customer's hands in a really fast, efficient manner. Next up is technology. The first thing that I would want to highly recommend is still continue to leverage off third-party delivery apps such as DoorDash, UberEats, Postmates. These are all great platforms to be on because they have tons and tons of customers because at the end of the day, everyone is on these platforms looking for food to eat and especially if your item is on there, they would most likely order from you. So that is the pro. Now, the con side of having and using third-party apps is the fact that they charge an arm and a leg, 20 to 30%. And on top of that, you don't even own your customers. So this not only cuts right into your margins but you don't have any data that you can market to yourself. Some people see that as a pro. Some people see that as a con. I think that as long as you have the volume, as long as your food is good, this is a great place to start. Next up is branded online platforms. So similar to third-party apps but you host your own delivery system. You host your own website. You host your own platform where people can order from and you figure out your own delivery. Now this, you get to save up on the 20 to 30% commission because there's no commission. It's your own platform. And on top of that, you own the data. So that means you can market to these people that buy from you again and again. So that's a great, great advantage to have. Now the con with that comes from the major decrease in customers, right? So you're not getting the flow of customers going through your platform all the time because when was the last time you ordered something and you go to a specific website? Not very likely. Most likely if you're using third-party apps and you want delivery to your door, you would use these apps and you figure out what to order. And that's the reason why a lot of people, even though they charge 20, 30% commission, they still rely on third-party apps. Once again, give and take. Lastly, there is another really, really upscale technology. Basically it consolidates all these third-party apps and everything into one platform. And this platform allows you to actually receive orders and also integrates into your point of sale system. This is a really, really new system. I don't know how well it does. And at the end of the day, it is super efficient. The idea of it is brilliant as well because it not only allows you to actually not have 10 tablets sitting on your cashier, but also it consolidates to your point of sales program. That means that you can actually track how many you sold. That means you can track your cost of goods sold. That means that everything is already tracked and thus allows you to generate report much, much faster. I highly, highly think this is a great technology and that it is up and coming. So definitely keep an eye on that. Once again, it really comes back down to your preference to what you view as a pro and what you view as a con. Next up is to consider your equipment that is needed from racks to shelving to your sink to the ovens to chopping boards to different blenders. These are all super important things to consider to plan for when opening up your cloud kitchen because different cloud kitchen has different setups and within different setups, they have different rates that they charge. So for example, if you're really focusing on bakery items, then definitely choosing a cloud kitchen that has a conventional oven is super, super a necessity, right? Versus if you're just creating tacos, for example, something that is super easy to make, you just need a frying pan and you're good to go. So depending on specifically your food offering, the type of equipment needed is also very, very different. So considering that and walking through the whole system and actually doing the vetting at these different cloud kitchens would allow you to actually choose the right location and also to budget for your own equipment expenses as well because some places would allow you to bring your own equipment, allow you to plug it in and use their electricity. Other people and other cloud kitchens don't like you bringing in your items because they don't want to be liable for it as well. So once again, consider all the different equipments that you need to purchase and use within your food concept when choosing a cloud kitchen location. Next up, and one of the most difficult thing to consider is licensing. A lot of people really oversee this process because you know what, didn't even know that licensing is required. However, if you're having and establishing a restaurant within a cloud-based kitchen, licensing is a huge thing that is off your shoulders because they would have already had built a facility that is suitable for the health authorities. So definitely if you are considering opening a cloud kitchen, you already have shaved off a ton of responsibility off your shoulders, but you would still need to have your proper business license and whatnot. So definitely just go on Google and search business license within your city. You're gonna have a ton of things that pops up and to inquire with them exactly what you're looking for even though you're in a cloud kitchen facility. As an additional note, a lot of cloud kitchen also offers consultations to help you get these licenses that are required because they understand a lot of people who are starting is first-time restaurateurs and that's the reason why they have these consultation service. So definitely reach out to them. Next up is staffing. Now contrary to running your traditional restaurant, you're not gonna be as under as much pressure on finding good, talented staff to take care of the front of the house for you because it's not necessary anymore. No customers are coming in through the doors. However, it is still very important to find talented staff who can actually withstand the pressure, the pressure of 20 orders coming in at once and you need to churn that out in a matter of 15 minutes. So that's a lot of pressure to being able to multitask. Some of the different positions that you may wanna consider would be line cooks, would be operational manager and if you're creating your own fleet and your own delivery system, then you may wanna consider having a fleet of drivers working for you as well. So overall staffing is not gonna be as crazy as a traditional restaurant but it is still something to definitely consider and to make sure you hire someone who can handle the pressure. There you go, almost, almost done guys. The last one is marketing. Now I can't give you all the marketing tactics. It is not a one size fits all. It means that you need to experiment with different marketing tactics for your specific case and your food concept. Now to touch up on a few different strategies that you can use, Instagram first of all is something that is still super prominent today because everyone is still consuming on Instagram so if you have really good appealing pictures, people will definitely order from you but you still need to understand what you're doing specifically on Instagram. Second tactic that you can use is email marketing. When you collect a bunch of emails you can actually send them regular emails on a daily basis, on a weekly basis and give them value after value after value and then when you have things to promote you can actually promote it to them and they are gonna be much more receptive to your messages. UGC, user generated content is also super, super helpful. What does that mean? It means testimonials when people really, really enjoy your food they're gonna write your review. That is something that you can show off. That is something that you should showcase to your potential customers. Yelp reviews, Facebook reviews, all the different types of reviews or even someone just leaving you and tagging you on Instagram. These are all user generated content that you should repurpose, that you should save and that you should use it to market out to other people as well. And the next thing up is website. Definitely do not underestimate the effect of your website because more than 80% of the people that go and decide to eat at a certain location they would always check their website mainly to check what they have to offer. So make sure that you do not neglect your website definitely check out this video right here where I talk about the main components of your website. So there you go, marketing, no size fits all but it is also crucial for you to actually try and implement and experiment with all these different strategies. So there you go guys, this is a long video covering all the bases of how do you start a cloud kitchen. I really hope that you enjoyed this video because we've spent tons and tons and tons of time just giving you value over value because I just want you to be super successful. But if this video is still not enough for you to start your own cloud kitchen actually start your own restaurant definitely check out in the description below a full on hour of content that I created on teaching you how do you choose the right concept how do you hire people, how do you market to them how do you create your menu and this is a full on hour masterclass that I've conducted just specifically free for you definitely check out in the description below. I really hope you enjoyed this video. If you do make sure you smash the like button subscribe along this whole journey and I'll see you guys in the next video.