What is going on with ghost kitchens on uber eats?
Uber Eats is taking action against ghost kitchen listings by delisting certain delivery-only restaurants, as initially reported by [The Wall Street Journal].
The company has introduced a new set of standards for these virtual restaurants, aiming to reduce the number of listings that have identical menus. These virtual establishments, commonly referred to as ghost kitchens, operate without a physical dining space and are primarily designed for food delivery services like Uber Eats, Grubhub, and DoorDash. Some ghost kitchens are part of larger franchises, while others are independent. However, the issue arises when multiple kitchens, sometimes even from the same location, offer the same menu under different brand names.
To address this, Uber Eats now mandates that virtual locations must have menu items that differ by at least 60% from other virtual restaurants operating from the same physical location. This rule also applies to the main restaurant that houses these virtual brands. Furthermore, both the ghost kitchen and its parent restaurant must maintain a rating of 4.3 stars or above on the app, have a cancellation rate of 5% or less, and ensure that inaccurate orders are below 5%. Non-compliant virtual restaurants risk being removed from the platform.
The Wall Street Journal highlighted that Uber Eats is set to remove approximately 5,000 virtual kitchens that violate this policy. This includes 14 virtual brands operating out of a single deli in New York City. Despite this, the number of ghost kitchens on Uber Eats has surged from 10,000 in 2021 to around 40,000, accounting for about 8% of all listed restaurants in the US and Canada.
John Mullenholz, the head of Uber's virtual restaurant division, emphasized the importance of these new quality standards, stating that they are designed to benefit both consumers and merchants. He believes that these delivery-only concepts provide a unique opportunity for restaurant owners to expand their businesses.
The Rise of Ghost Kitchens: The rapid increase in virtual listings on Uber Eats, from 10,000 in 2021 to 40,000, highlights the growing popularity and potential profitability of ghost kitchens. What factors have contributed to this surge, and how might it shape the future of the food industry?
Quality Over Quantity: By introducing stricter standards, Uber Eats is prioritizing the quality of its listings over sheer numbers. How might this decision impact user experience and the platform's reputation in the long run?
The Balance of Innovation and Regulation: As businesses innovate and find new ways to operate, platforms like Uber Eats are faced with the challenge of regulating these new models to ensure quality and fairness.
How can platforms strike a balance between fostering innovation and maintaining standards? If your ghost kitchen is one of many impacted by this, get in touch. We may be able to help you.