Tech-Savvy Millennials are shifting the paradigm of businesses in the direction of a virtually evolving world. Virtual restaurants are among the latest trends to follow virtual gaming and virtual shopping, among others. Virtual Restaurants, also known as Ghost Restaurants, do not have typical dining rooms. Instead, these I-eateries offer online ordering for delivery only, take-out dining, and on-demand concierge catering experiences. Diners use online food ordering applications and website to view restaurant menus, place orders, and get their food from a few clicks on their smart phones.

Off-premises dining is a vast space, and it is continually growing and expanding as technology advances. The segment, which includes drive thru, take-out, catering and delivery, now accounts for more than 38% of all restaurant sales. Its size is only expected to increase, as its growth outpaces that of overall restaurant sales.

Popular online food delivering companies are expected to cover over 70 percent of the US population. Moreover, the number of cities these online food delivery companies will cover is also expected to double, year over year. The larger part of this expansion would happen in smaller cities and suburban areas. Because of the increasing demand for off-premises services and the need to save on costs, you will witness an increasing number of Virtual Restaurants over the next few years.

Virtual Restaurants are increasingly being embraced as technological advances continue to improve, providing restaurateurs with a rainbow of benefits. Diners additionally appear less concerned about their acquaintanceship with restaurants, and more it seems, with the high quality of food, the convenience, and the overall experience they receive.

The Benefits of Virtual Restaurants

Lower rent and overhead

Commercial real estate prices continue to sky rocket, especially in big cities. Opening a restaurant in the right location, with proper decor, and with good staff is a huge investment. A Virtual Restaurant does not need to worry about these traditional costs as a normal eatery would. Owners can find commercial kitchen space in a small, less crowded area that cuts down on upfront and on monthly overhead costs.

Lower staff expenses

There is more opportunity to minimize labor expenses, given the added pressure for an increase in the minimum wage. Virtual Restaurant concepts are especially appealing to owners for this reason, and due to the growing struggle to find, train and keep reliable staff. Restaurant owners can instead hire a small team that is easier to manage and incentivize, and make larger investments in more durable tools and high capacity equipment to improve kitchen efficiency, and profits.

Off-premises dining is the future

Virtual restaurant concepts are another solution that owners can take advantage of in order to keep up with increasing costs and the evolving demands of the consumer for off-premises services.

“Consumers want convenience. It’s King.” remarks David Henkes of Technomic. This is evident in the fast growth of online delivery companies like Uber Eats and corporate catering leaders ezCater. Diners increasingly seek solutions that gives them the ability to balance their busy lives, with their love of food and crave for experiences. The boom in the online delivery and off-premises catering are evidence of that, and restaurants that can adapt to these changes will be the ones that survive into the future.

Less capital intensive

The most charming feature of Virtual Restaurants is the cheaper start-up costs involved. Owners can get their operations up and running with smaller investments, having less need for large costly renovations, buying of furniture and shelling out mini-fortunes on securing real estate in prime locations to increase the chances of success.

Bringing more home

Virtual Restaurants are poised to take benefits of the consistently increasing food delivery and off-premises trend. With their lower cost model that mitigates labor and renting costs, Virtual Restaurants are almost certain to become more prevalent shortly, and allow restaurateurs to put more into their pockets at the end of the day.

Focus on food quality

Food quality is at the top of the list of what diners consider when they buy from a restaurant, closely followed by their experience. With less need to manage certain areas of a traditional restaurant, Virtual Restaurant owners can double down on their focus of providing the best quality food possible. This will translate into better reviews from customers and maintaining a strong customer base, which both equals to larger profits and greater opportunities for growth and sustainability.

Provides more flexibility and better testing opportunities

The flexibility of Virtual Restaurant allows for new concepts to be tested quickly. Owners can test and optimize their menus and particular concepts to see its reception by the market, and then make fast adjustments to their menu and food selection that will be most profitable for them. This is an option that is not afforded to traditional restaurants. Current restaurant owners face a sink or swim outlook, which can be especially grim if proper research is not done before.

The insight of food trends

In the era of on-demand food, Virtual Restaurants are leveraging digital menus as a performance marketing tool. The online food delivering companies collect a massive amount of customer data from millions of users, and leverages it to increase sales. Data is known as “the new gold,” and customers data is becoming increasingly beneficial to restaurants. This means that restaurants that offer online ordering, can use behavior and purchasing data to get a unique insight of the kind of foods that are performing and which are slumping, along with who diners enjoy their meals with. This is an advantage that restaurants using traditional paper menus simply does not have.

The success and potential of Virtual Restaurants is impressive. Startups restaurants are rolling the dice more on this option, and will undoubtedly more in the future, in order maximize the chance of their ventures succeeding. 2019 is expected to bring a handsome growth opportunity in the VR sector.