A seismic change is afoot in the Indian culinary scene. The full service restaurant, once the exclusive provider of culinary pleasure, is no longer the only place people love to go to. The cloud kitchen is a new agile technology-enabled competitor that has appeared out of the digital ether. This disruptive concept also called a ghost kitchen or virtual restaurant is not a mere hype but a powerful entity transforming the landscape of the food and beverage sector in the country.
Powered by a rapidly-growing digital population and the unending streak of convenience, the cloud kitchen ecosystem is experiencing massive growth, turning it into a fertile ground for would-be entrepreneurs. This is a thorough piece of writing that explores the ins and outs of the cloud kitchen franchise business model in India and provides a blueprint of sorts on how to get in on this profitable industry.These figures tell an interesting success story of an industry that is going places. It is projected that the Indian cloud kitchen market will be worth about $1.3 billion in 2024.
It is estimated to rise tremendously, forecasted to reach an astonishing $4.4 billion by 2032, growing at a healthy compound annual growth rate (CAGR) of 16.63 percent. This increase is directly connected with the boom of the online food delivery services. By the beginning of 2024, India had more than 400 million consumers of online food delivery services, which is constantly growing. Moreover, the current investment in the Indian food-tech sector is holding up well, with startups in the industry securing more than $2 billion in 2023, as evidenced by the faith of investors in the business models of the future, such as cloud kitchens.
Why Choose a Cloud Kitchen Franchise?
The franchise model is a great opportunity for aspiring business owners to enter the food business because it provides a unique business system that offers the guidance of a franchise and minimizes much of the risks associated with opening a new business. There are many advantages, including the following:
- Lower Startup Costs: A cloud kitchen franchise will require less capital to start than a traditional restaurant. A cloud kitchen does not have a dining area, so there are no expensive commercial real estate costs and no furniture and interior design costs.
- Less Operating Costs: A cloud kitchen has lower operating costs than a restaurant because there are no front-of-house staff and the rental and utility costs are much lower.
- Brand Recognition: With an established franchise, you will have a recognizable brand name and a customer base to start with. With a cloud kitchen franchise, you will eliminate the time, money, and effort that it takes to create your own brand.
- Defined Business System: The franchisor will provide you with a defined business system, including standard operating procedures (SOPs), recipes, and operating guidelines. By using the franchisors documented forms of operation, you will reduce the learning curve and increase your chances of success.
- Training and Support: Well-respected franchisors offer a comprehensive training program for franchisees and their staff, including food preparation, menus, quality service, marketing, and customer service. Franchisors also offer ongoing operational support.
- Marketing and Advertising Support: The franchisee will benefit from the marketing and advertising work being done on behalf of the parent brand (often including both national and regional advertising) that would be hard for an independent operation to afford.
- Access to Supply Chain: Franchisors typically have an established supply chain, assuring the product quality of ingredients, and in many cases, offer economies of scale by providing bulk purchasing power.
- Technology: Many cloud kitchen franchises provide their franchisees with a technology stack, including at a minimum an order management system, inventory management software, and access to data on various analytics.
- Scalability: The cloud kitchen model, due to its relatively low investment per outlet and reduced operational complexity, allows for faster scaling. Franchisees may open several outlets in a small time frame.
- Focus on Operations: If the franchisor is responsible for several strategic decisions concerning the business, including branding and marketing, you are allowed to focus on the kitchen operations and maintain food quality, hygiene, and delivery speed.
Top 10 Cloud Kitchen Franchise
1.Rebel Foods
Rebel Foods is the largest internet restaurant company globally, an actual giant among the Indian cloud kitchens. Their game-changing innovation in the industry is the invention of the multi-brand cloud kitchen, which has a range of successful and varied culinary brands united under one strategic brand. It has such well-known brands as Faasos wraps, Sweet Truth sinful desserts, Behrouz Biryani authentic biryanis, and Lunchbox healthy meals, thereby covering an expansive range of food tastes.
A strong technology backbone, advanced supply chain management and intense marketing strategies support their operational capabilities, making them a force to reckon with, in the industry. When choosing a franchise Rebel Foods, one gets to become a part of a carefully crafted engine that has a history of delivering success in building and growing food brands. Their wide presence and brand name provide a big competitive edge to any up coming food entrepreneur.
Investment Details:
- Initial Investment: ₹20 Lakhs – ₹30 Lakhs
- Franchise Fee: ₹5 Lakhs – ₹8 Lakhs
- Royalty Fee: Varies depending on the brand and model
Support Offered:
Comprehensive training, site selection assistance, technology support, marketing and branding support, and access to their established supply chain.
Ideal Locations:
Tier 1 and Tier 2 cities with high population density and a strong online food ordering culture.
2. Biryani by Kilo
Biryani by Kilo has tactfully devised a niche within the market by focusing on serving dum-cooked, hygienic biryani, which is traditionally served in a handi. Their relentless focus on quality, use of freshest ingredients and offering a quality customer experience has strongly connected with the biryani lovers across India. Their menu boasts of a variety of regional biryanis like the Hyderabadi style, Lucknowi style and Kolkata style biryani guaranteeing a rich culinary experience.
They have a carefully selected range of tender kebabs, rich kormas, and sweet phirni besides their famous biryanis, which increases their appeal. Obtaining a Biryani by Kilo franchise is an exceptional occasion to associate with a brand that is extensively perceived as equal to genuine and quality biryani. Their high brand recall and the existence of a dedicated, loyal customer base are major strengths that any potential franchisee could boast of and are sure of a good start toward growth.
Investment Details:
- Initial Investment: ₹35 Lakhs – ₹45 Lakh
- Franchise Fee: ₹10 Lakhs
- Royalty Fee: 5% of net sales
Support Offered:
End-to-end setup assistance, staff training, marketing support, and a centralized call center for order management.
Ideal Locations:
High-income residential areas, corporate hubs, and markets in Tier 1 and Tier 2 cities.
3. EatFit
Being a part of the large health and wellness ecosystem of Cure.fit, EatFit successfully captures the growing consumer need for healthy and nutritionally well-balanced meals. They have an ingeniously put together menu that is carefully crafted by the best of nutritionists, with a wide variety of dishes such as nutritious thalis, healthful bowls, crunchy salads, and guilt free snacks, with each one clearly specifying the number of calories it contains.
EatFit has managed to become the brand of choice whenever it comes to health-conscious people who do not want to compromise on taste and still want to maintain their dietary needs. High affiliation of the brand with Cure.fit gives it a strong base of credibility and ready customer base, who are willing to buy their offerings. EatFit franchise is one of the exceptional opportunities that an entrepreneur can pursue to enter the blooming health and wellness industry, leveraging on the rising trend of mindful eating and healthy living.
Investment Details:
- Initial Investment: ₹15 Lakhs – ₹25 Lakhs
- Franchise Fee: ₹3 Lakhs – ₹5 Lakhs
- Royalty Fee: 6-8% of net sales
Support Offered:
Menu and recipe development, training on healthy cooking techniques, marketing and branding support, and access to a health-conscious customer base.
Ideal Locations:
Metro cities with a high concentration of young professionals, fitness centers, and corporate offices.
4. Box8
Box8 has carefully distinguished its niche by offering an assorted variety of Indian meals in a most convenient and easy to consume format. They have an extensive menu which includes all-in-one meals, rich curries, fragrant biryanis, flavorful wraps and fresh sandwiches thereby serving a very wide and diverse customer base. One of the USPs of Box8 is that they highly believe in technology and this reflects in their convenient mobile app and a highly optimized delivery network to provide a hassle-free experience to the customers.
The tremendous growth experienced by Box8 can be mainly explained by the fact that they have not compromised on operational excellence, and their determination to attain high customer satisfaction rates proved to be unfading. By choosing a franchisee with Box8, one will get a fairly established and acknowledged brand that has a substantial presence in the very competitive online food delivery industry, which will serve as an excellent basis to develop the business.
Investment Details:
- Initial Investment: ₹15 Lakhs – ₹20 Lakhs
- Franchise Fee: ₹4 Lakhs
- Royalty Fee: 8% of net sales
Support Offered:
Comprehensive training, operational support, technology platform, and marketing assistance.
Ideal Locations:
Tier 1 and Tier 2 cities with a large student and young professional population.
5. Kouzina Food Tech
Kouzina Food Tech works on an advanced multi-brand cloud kitchen concept, offering an outstanding culinary collection, including North Indian, Chinese, and Continental dishes. One of the fundamental elements of their strategy includes a crucial optimization of the kitchen processes with the help of the recent advancements in technology and subsequent continuous improvement of the overall customer experience.
The franchise model proposed by Kouzina is asset-light, which is a strategically remarkable franchise model, and thus a very attractive one to new entrepreneurs who want a reduced barrier to entry. Their support system is exhaustive and strong covering aspects as simple as initial kitchen setup and comprehensive staff training to perform effective market analysis and successful integration of technology. A Kouzina franchise gives you the benefit of drawing on the focused experience of a technology based food company so that multiple and separate brands can be operated efficiently under one roof,at one centralized point.
Investment Details:
- Initial Investment: ₹10 Lakhs – ₹15 Lakhs
- Franchise Fee: Varies based on the model
- Royalty Fee: A percentage of revenue
Support Offered:
Technology platform, marketing support, operational guidance, and access to a portfolio of brands.
Ideal Locations:
Urban and semi-urban areas with a high demand for online food delivery.
6. The Rolling Plate
The Rolling Plate is presenting a unique franchise model that has been specially designed to be highly accessible and of low investment thus appealing to a large number of entrepreneurs. Their specialties are wide and varied with a firm commitment to the excellent quality and pocket-friendly prices of all their foods. Their investment flexible franchise models like FOCO (Franchise Owned, Company Operated) and FOFO (Franchise Owned, Franchise Operated) offer diverse participation provisions, suitable to investors of diverse inclinations and capabilities.
The high significance of a lean operating model, along with an efficient support system provided by the franchisor, makes the Rolling Plate an extremely attractive opportunity, especially to first-time entrepreneurs trying to venture into the food business. The broad choice of their menu and wise concentration on the popular food segments play a vital role in their growing popularity and spread in the market.
Investment Details:
- Initial Investment: ₹5 Lakhs – ₹15 Lakhs (depending on the model)
- Franchise Fee: Included in the initial investment
- Royalty Fee: Varies based on the model
Support Offered:
Complete operational management in the FOCO model, training and support in the FOFO model, and a well-defined supply chain.
Ideal Locations:
Tier 1, Tier 2, and even Tier 3 cities with a growing online food delivery market.
7. Biggies Burger
Biggies Burger is an influential Indian origin burger chain that has managed to attain tremendous popularity within a short span of time owing to its special flame-grilled patties and a huge, versatile menu that is particularly designed keeping in view the Indian palate preferences. They have a vast and attractive variety of vegetarian and non-vegetarian burgers, along with other popular fast-food items. Biggies Burger has an excellent and well-built brand name and is In the process of increasing its presence throughout the country via its highly organized franchise system.
They offer a full support system to their franchisees which incorporates intensive training, viable marketing techniques and continual operation support. The decision to franchise Biggies Burger comes with a chance of venturing into the fast-food industry that is already proven to be thriving with a brand that has a unique selling point and already has a following.
Investment Details:
- Initial Investment: ₹25 Lakhs – ₹40 Lakhs
- Franchise Fee: ₹5 Lakhs – ₹7 Lakhs
- Royalty Fee: 5% of net sales
Support Offered:
Site selection, store setup,training, marketing and promotional support, and continuous operational guidance.
Ideal Locations:
High-street locations,food courts in malls, and areas with high footfall in major cities.
8. WarmOven
WarmOven has become one of the key players in the online bakery and dessert segment, conducting its operations on the cloud-kitchen basis only. Their specialty is freshly baked cakes, pastries, brownies and other delicious desserts that satisfy everyday cravings to special moments. Their advantage is a made to order basis, thus delivering fresh and customized according to the order, which has built them a strong following in the key cities of India.
WarmOven effectively leverages the steady market needs of festive and sweet delights and desserts without incurring the expenses of a physical shop. WarmOven franchise offers a chance to become a part of the continuously popular dessert industry with a widely-known brand that has established quality and effective delivery service. Their support is all rounded and the franchisees can easily run the operations without any hitch and enjoy good market presence.
Investment Details:
- Initial Investment: ₹7 Lakhs – ₹10 Lakhs
- Franchise Fee: Varies (typically included in initial investment or a separate fee)
- Royalty Fee: A percentage of net sales (around 8-12%)
Support Offered:
Recipe standardization, operational training, marketing assistance, technology platform for order management, and supply chain guidance.
Ideal Locations:
Urban and semi-urban residential areas, corporate hubs, and areas with high demand for online dessert delivery.
9. WOW! Momo
It is surprising and amazing that what started as a small kiosk in Kolkata has now turned into one of the most popular and ubiquitous food brands in India. WOW! Momo has established a considerable market leadership due to its highly innovative and wide variety of momos that forms a part of the menu, such as traditional steamed, crispy fried, just pan-fried and even special moburgs (momo burgers). Catchy and unique branding plus the promise of quality has made them a favorite among people of all ages.
A WOW! Momo cloud kitchen franchise is a terrific chance to work with a brand that has a humongous following and has a formidable presence in the market. The fact that they have developed dedicated competence in a small but hugely popular food category is in itself a boon to any potential franchisee as they are likely to attract consumers readily.
Investment Details:
- Initial Investment: ₹15 Lakhs – ₹20 Lakhs for a cloud kitchen model
- Franchise Fee: ₹3 Lakhs – ₹5 Lakhs
- Royalty Fee: 5% of net sales
Support Offered:
Comprehensive training on product preparation, marketing support, and assistance with site selection.
Ideal Locations:
Tier 1 and Tier 2 cities with a young population and high demand for quick-service restaurants.
10. Curefoods
Curefoods is another Indian cloud kitchen player that has been aggressive in following a strategic model of acquiring and successfully expanding food brands with potential. They have an extensive collection of cuisines and brands under their belt, including the health-focused EatFit to the rich delathers desserts of CakeZone and the beloved pizza restaurant, Sbarro (of which they are the master franchise holder in selected markets).
A franchisee dealing under one of the brands under Curefoods umbrella implies that you will be riding on their vast experience in the operations, state-of-the-art technology, and financial capacity. His singleness of purpose is to create an end-to-end house of brands that is carefully crafted to appeal to different consumer needs which makes them a highly dynamic and fast growing company in the competitive food-tech space.
Investment Details:
- Initial Investment: Varies significantly depending on the brand (e.g., EatFit, CakeZone, Sbarro).Generally ranges from ₹15 Lakhs to ₹40 Lakhs.
- Franchise Fee: Dependent on the specific brand.
- Royalty Fee: A percentage of revenue, which varies by brand.
Support Offered:
Brand-specific training, operational support, and access to a larger corporate structure.
Ideal Locations:
Major cities and towns across India, with a focus on locations that align with the target audience.
Investment and Cost Considerations for a Cloud Kitchen Franchise
Although the initial investment in a cloud kitchen franchise is generally lower than in a conventional restaurant, you must have a clear understanding of the cost elements involved. In this section, you will explore the likely costs:
- Franchise Fee: This is normally a one-time fee payable to the franchisor for the right to use the name, the business model, and the support systems.
- Kitchen Setup and Equipment: This involves the cost of setting up the kitchen space, purchasing the cooking equipment, refrigeration units, and other appliances. Costs will vary depending on the cuisine and how extensive the operation is.
- Licenses and Permits: You will need several licenses to open a food business in India, including FSSAI licenses, GST registration, trade license, and fire and safety license.
- Initial Inventory: This is the cost of the raw materials, stock and ingredients needed to commence operations.
- Working Capital: It is important to have ample working capital to cover initial operational costs, including salaries, utility bills, and marketing etc, until business profitability is achieved.
Steps to Start a Cloud Kitchen Franchise in India
There is a process to becoming a franchise of cloud kitchen, and this is how you do it:
- Research and Self-Assessment: Before you dive into the cloud kitchen industry or franchise brands, you need to do your research and choose a franchise that is right for you. You must also assess your budget, skills, and company goals and then pick a franchise that suits those plans.
- Contact the Franchisor: Once you’ve determined that some of the franchises you researched are of interest to you, contact these companies to express interest and request their FDD (franchise disclosure document).
- Review the Franchise Disclosure Document (FDD): The FDD is a legal document provided by the franchisor that contains crucial information about the franchisor, including their financial statements, franchise agreement, and the existing franchisees’ names and how to contact those individuals. Read the FDD carefully.
- Talk to Current Franchisees: After reviewing the FDD, you will want to contact current franchisees and ask them about their experience with the brand. This is important in understanding the franchisor’s support system, as well as determining whether the business is profitable.
- Secure Funding: Once you have determined what your investment will be, you will need to identify how you will source funds. These funds may come from personal savings, a bank hold, or an investor.
- Sign the Franchise Agreement: If you have done your due diligence and your funding is locked in, you can sign the franchise agreement. It is a good idea to have an attorney review the franchise agreement before you sign it.
- Location and Setup: Work closely with your franchisor to find a suitable cloud kitchen location (i.e., lease/signed). Once you have obtained your location license in YOUR name, you will begin the setup process, working alongside your franchisor to set up your cloud kitchen according to their standards.
- Licenses and Permits: Apply for the correct licenses and permits to legally work the food business in your city.
- Hiring and Training: Hire chefs and kitchen helpers. You and your staff must now complete any training offered by the franchise account.
- Grand Opening and Marketing: Plan for a grand opening of your cloud kitchen, following the marketing and promotional plan your franchise account suggested on your initial meetings with them to generate excitement and gain customers.
Conclusion
Cloud kitchen has proved to be an effective and affordable entry point to the Indian food and beverage industry which is highly vibrant. It has a powerful mix of reduced risk, smaller investment and support of a well known name. The need to provide convenience, quality, and variety of foods will continue to increase as the digital ordering space enters more growth and consumer tastes continue to change.
To the entrepreneur-to-be, who loves food and has the determination to win, the cloud kitchen franchise is not only a business proposal, but an offer to be a part of the future of food in India. With the proper brand selection, careful planning of the financial aspect of the business and attention to operational excellence, it is possible to create a recipe of success in the invisible yet always present world of cloud kitchens.
FAQs
What is the minimum investment needed to open a cloud kitchen franchise in India?
Depending upon the smaller asset-light models, the minimum investment may be as low as 5 lakhs, however, in the case of more established brands, it would be between 15 lakhs to 40 lakhs.
Should I have experience in the food industry to possess a cloud kitchen franchise?
The majority of the reputable franchisors will offer extensive training and support to their franchisees, in relation to all parts of the business.
What is the cloud kitchens franchise break even period?
Break-even period may differ brand wise, location and efficiency of operations. Nevertheless, a franchise of cloud kitchen, when executed well, can expect to break even in 12 to 24 months.
Is it possible to have several cloud kitchen franchises?
Yes, most franchisors would request their profitable franchise to build numerous outlets. The cloud kitchen model is scalable, thereby, making multi-unit ownership an attractive and profitable possibility.
