With business costs rising, a group of Richmond entrepreneurs are offering a lower-cost solution for running a restaurant.
MOD Kitchen is introducing the concept of a “cloud kitchen” to Richmond – instead of owning an independent restaurant, multiple business owners prepare food for takeout or delivery in their designated area in a shared facility. Cloud kitchens are sometimes referred to as "ghost kitchens" or "commissary kitchens."
“Even from 10 years ago, property prices have now been ridiculous, and also the cost of goods have risen quite high,” said Tony Ferreira, co-founder of MOD Kitchen.
“Restaurant is already a really thin-margin type of business, and on top of that, salaries and the minimum wage is getting higher, you're really left with pretty much nothing at the end of the day. So we think, why not do a cloud kitchen model?”
He said this model allows new entrepreneurs to try out their restaurant ideas without having to invest a lot of capital, as they share the rent with other businesses and need a much smaller team. It is also an option for experienced restaurant owners who are looking to downsize.
“A lot of the mom-and-pop shops don't want to worry about the day-to-day operations like hiring too much staff, they don't want to worry about, ‘If my restaurant is going to get filled in space or not.” We can help them have a little bit of more peace of mind,” said Ferreira.
The location near Ironwood Plaza in southeast Richmond is currently under renovation and is slated to open in December. It will have 10 kitchens and one public-facing milk tea shop – five of the kitchen spots have already been filled including by some well-known brands, according to Ferreira.
There will be front-desk staff who take care of the orders and dishwashing services on site, and the team also plans to, in addition to delivery, provide a kiosk pickup service and website and social media ordering.
“In MOD Kitchen, [vendors] get to do bulk purchasing and leverage off of their product suppliers, so they're paying less for what they're ordering,” said Ferreira.
“And we think it's a really neat idea to bring 10 individual vendors into one spot, so it’s like a one-stop shop where you and your family, your significant others or your friends, can order different types of food under the MOD Kitchen roof.”
Ferreira said the concept of a cloud kitchen was created some time ago, but he and the other co-founders saw the growing need for it as the pandemic has changed many people’s dining habits – food delivery has boomed and people want more value for their money.
Growing up in Richmond, Ferreira, an experienced chef and restaurant operator who has spent the past few years in Hong Kong, said he is very excited to contribute to the diversity of Richmond’s food scene.
“You always see new restaurants opening up in Richmond and because of this, [we believe] they will be quite adventurous and quite open to something like a cloud kitchen,” he said.
“Richmond has offered us so much when we were growing up and when we had an idea like this one, we thought we could really bring the community of Richmond together, especially the food vendors of Richmond.”
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