Restaurants eager to capitalise on the high demand for home-delivered food are now expanding their portfolios and experimenting with new cuisines through virtual brands. International start-up Geezy Foods is building a network of virtual restaurant brands across Australia and internationally by transforming underutilised kitchens into delivery hubs. According to Ibisworld, Australia’s online food delivery market has grown 23.5 per cent per year, on average, between 2017 and 2022. Revenue is no
is now in the region of $930.5 million and it is expected to increase 9.7 per cent this year.
“Aussies have become home-based restaurant connoisseurs during the pandemic, allocating more than 30 per cent of their food and grocery budget to home-delivered take-away through on-demand delivery apps,” said Dhruv Kohli, vice-president of growth and strategy at Geezy Foods.
“Dining out has become a very formal thing. Yes, it’s good for weekends, but not really for Monday to Friday when you’re tired from work. [Australians] still want to access the same quality and calibre of restaurant-quality meals that they know and love, but they want them delivered to their home instead, so they can indulge in the comfort of their own dining room or in front of the TV.”
Dark kitchens and diversification
Restaurants are meeting this demand by dedicating all or a portion of their operations to on-demand delivery of meals. Some are even launching entirely new brands from the same kitchen.
“Many restaurants have the capacity to prepare more meals,” Kohli explained. “Why not utilise the capacity to generate more revenue? On-demand delivery means the kitchen side of the business is still operating, yet the expenses associated with staffing, waiters, kitchen hands, and service wear are avoided.”
As an example of these ‘dark kitchens’, he points to a Korean restaurant branching out into burgers using ingredients already at its disposal to create an additional revenue stream. This virtual brand is visible only on food-delivery platforms, such as UberEats and Deliveroo.
“Restaurants that don’t want consumers to know they are operating on-demand delivery have created virtual restaurant brands for apps to ensure they do not compromise their main restaurant brand in the market,” Kohli said.
Geezy Foods helps restaurants get their virtual brand up and running on food-delivery platforms, with marketing and branding support and customer relationship management. The company charges a royalty fee of 4-8 per cent, depending on the brand and the location. Geezy is already working with over 200 restaurant kitchens.
“We help [restaurants] create these brands; through our software and data they can see what works in the market,” Kohli told Inside Retail. “All the restaurant does is cook the food, nothing else.”
Speed and convenience are critical components of the offer, with the average delivery time being 33-34 minutes. Kohli is hopeful that the model can help small, independent restaurants compete against the bigger market players.
“[Often] these very traditional, family-owned restaurants do not understand algorithms and data. The big chains [have the] advantage and all these [smaller] restaurants get left out,” Kohli said. “We want to support local restaurants and they are successful on these platforms and become a part of this virtual franchise.”
Rapid growth
Geezy Foods is part of Geezy Global, a technology start-up with operations in Australia, New Zealand, Ireland, the UK, the US, India, Singapore, and UAE. The company includes Geezy Go, an online supermarket that launched last year in Australia offering delivery in under 20 minutes of more than 2000 local and branded food and grocery products.
Being a global player, Geezy has the advantage of being able to lean into an established ecosystem of suppliers, customers, and technological capabilities in various locations.
Kohli believes dark kitchens are revolutionising the industry and present “one of the biggest opportunities for the hospitality sector”. Geezy Foods aims to have over 1000 dark kitchens on board by mid-2022. “We are operating at full capacity, constantly hiring employees; we’re growing at nearly 150 per cent, month on month, and we’re seeing strong interest from restaurant partners,” Kohli said. “We are active in four different markets now…Southeast-Asian markets will be the next focus.”