Undoubtedly, the online food delivery market has flooded after 2020, right?

The cloud kitchen market in Dubai is experiencing rapid growth, and this trend is worth following. The estimated increase of $154.9 billion by 2035 will provide entrepreneurs with considerable opportunities for kitchen business in Dubai.

What is a cloud kitchen business model?

Cloud Kitchen is a Kitchen business that only prepares food for delivery and takeaway orders. There is no separate dining space. This technique saves many operational costs and significantly increases the profit margin. These kitchen businesses partner with food-delivery apps that deliver prepared food to customers.

What are the key components of Cloud Kitchens?

• Centralized kitchens: This business model works with sizeable shared kitchen spaces that prepare food for received orders.

• Online identity: As these dark kitchens are not physically present, they consistently work to create an online identity to increase orders. Through such practices, they become a virtual brand, too.

• Data-driven operations: Cloud kitchens analyse previous data to optimise operations and enhance their menu offerings. This method also helps them develop better marketing strategies.

• Food delivery Platforms: These dark kitchens collaborate with more major food delivery partners to reach the maximum number of customers. Some kitchens have started taking orders on their websites and delivering them using in-house logistic systems.

Why is the cloud kitchen industry booming in Dubai?

The primary reasons for dark kitchens' popularity are food delivery platforms and people's changed lifestyles. Let's discuss these in detail:

Growing demand for food delivery in Dubai:

The younger population constantly searches for convenient, high-quality, fast delivery options. Dubai's rate of development is significantly high, leading most of the population to rely on these options. Most working professionals and students find preparing meals during or after working hours challenging, so they prefer these online platforms.

These platforms offer convenience facilities, increasing the demand for online orders daily. According to Euromonitor International, the estimated growth rate of this market is 15% annually from 2020-2025, which is surprisingly high.

Less operating costs: ( A key Advantage)

The Department of Economic Development (DED) has recognised cloud kitchens' potential by driving market growth and innovation. Cloud kitchens enable small businesses to generate higher revenue and recognition by providing cost-effective solutions for food entrepreneurs.

Reduced rent and utility bills:

These kitchens have reduced rental and utility bills by eliminating significant costs for physical diners. The total space required for these business models is also less than that of typical diners, as they only need a commercial kitchen space, which minimises the operational expenses.

Reduced labour costs: These types of kitchens require less staff to operate, unlike

the traditional restaurants and cafés that require a whole kitchen, servers and reception staff. This efficient model eventually cuts labour costs, generating higher income for even smaller cloud kitchens.

Increased efficiency: The cloud kitchen optimises its operations for speed and efficiency and actively works to reduce delivery time.

Reduced food waste: Orders are prepared according to portion size, which reduces food wastage in the kitchen.

Urbanisation and population growth:

With a population of 3.79 million, Dubai has become densely populated in urban areas with a large customer base for Cloud Kitchen. The population of Dubai will grow to

5.2 million by 2030, and residents will increasingly rely on online food delivery services. This particular population will bring peak growth to the cloud kitchen business in Dubai.

With a more extensive base, these kitchens will operate more effectively, reducing logistics costs and providing the best service experience.

Growth opportunities:

These Cloud Kitchens Dubai models will continue to provide employment and growth opportunities for many people and help expand tier-1 and tier-2 cities.

•Maximum coverage: Cloud Kitchen provides services like customised meals and more, and the delivery logistics cover most urban areas and even extend to remote areas.

•Innovation brings opportunity: The market is becoming more innovative, and services like drone deliveries and self-drive vehicles have been introduced. This technical development creates employment opportunities for developers and technicians.

Even the packaging ideas are getting creative and promoting green packaging for the orders.

•Increased focus on health-conscious consumers: Nowadays, a large number of people are looking for healthy meal options. Keeping this in mind, many Cloud Kitchens provide healthy and nutritional options to customers. The best part is that you can customise them to your choice.

Advancing infrastructure and logistics:

Dubai has the world’s most advanced logistics and high-speed internet connectivity, enabling this kitchen business in Dubai to deliver food quickly and provide a high-quality customer experience. The food arrives in minutes and comes serving hot, making these services popular in every age group.

Flexibility:

Cloud kitchens can operate multiple brands or concepts from a single location. The flexible nature of this model helps them to experiment with more varieties.

Food culture and innovation:

Dubai has a diverse food culture that blends traditional Middle Eastern Cuisine with international flavours. The Cloud Kitchen provides a platform to experiment with food

and generate innovative ideas to help businesses flourish in the food industry. The new experiments with food add new dishes to the menu, creating more options for customers to enjoy.

Government support and regulations:

The government has introduced initiatives to support the Dubai Cloud Kitchen business.

The local government provides permits and licenses to businesses after a complete analysis of the structure to operate legally and safely. A list of proper hygiene and sanitation guidelines is issued to ensure food safety and quality.

How does a cloud kitchen work?

• Creating a menu: Cloud kitchens usually develop their menu carefully to optimise it for delivery. They have to take everything into account, including food quality, packaging, and transportation as well.

•Order receipt and preparation: As the order is received through the delivery platform, a receipt is generated. The kitchen starts preparing the order as instructed in their kitchen space.

•Packaging: Food is packaged after preparation. The kitchen usually uses personalised packaging for visual marketing and innovatively uses green packaging.

•Delivery: This is the last step of the process, where the order is picked up by an assigned delivery partner or in-house logistics team member responsible for safely delivering it to the customer.

How much does setting up a Cloud Kitchen Dubai cost?

The cost of setting up a cloud kitchen is not explicitly available. Still, after adding the Cloud Kitchen Dubai license cost, rental space cost, equipment purchases, marketing, and staff salary, it can be estimated between $20000 and $27000.

To set up a cloud kitchen with less investment, you can rent it and cut the cost of setting up a traditional restaurant, which requires more capital. On average, Cloud Kitchen Dubai rent ranges from $135 to $540 monthly.

However, this figure can change according to the cloud kitchen's location, size, and setup.

How to set up a cloud kitchen in Dubai? A five-step approach :

Renting a cloud kitchen in Dubai can be a great way to start your food business without investing huge capital. Here's a five-step approach to setting up a cloud kitchen business in Dubai:

Step 1: Research and choose the location:
  • A good location is vital to reaching more customers, so choose an area close to the target market.
  • Always select a location with high foot traffic and demand for food delivery.
  • Ensure that the location meets commercial kitchen requirements and other zoning regulations.
Step 2: Check the kitchen facilities and equipment:
  • Check for the food preparation areas and storage facilities.
  • Ensure all the commercial cooking equipment ( ovens, stoves, refrigerators) is in good condition.
  • Waste disposal systems should be present.
  • Check for maintenance facilities.
  • All cleaning and sanitation facilities should be present.
Step 3: Review the rental agreement and terms:
  • It is essential to be careful regarding rental agreements and terms. Focus specifically on:
  1. Rent and utility cost.
  2. Payment terms and security deposit amount.
  3. Lease duration and renewal terms.
  4. Insurance and other liability costs.
Negotiate the terms, if required, to meet all your business expectations.

Step 4: Obtain necessary licences and permits:

The primary and most crucial step is to obtain the required permits and licenses from the authorities. These are provided after a complete analysis of the kitchen business, including its structure, location, and work nature. The different types of

License and permits are listed below:

• Food establishment license: Dubai's Food Control Department (FCD) issues this license if you meet all the food safety and cleanliness requirements.
  • Trade license: This licence is issued after initial approval from the Department of Economic Development (DED). To start your business, register it with DED and submit your application. Once approved, you can submit your application for a trade license.
  • Health and safety permit: The health and safety permit includes-
  1. Food safety permit: This permit enables a cloud kitchen to work legally and ensures food is prepared under hygienic conditions.
  2. Health card: The cloud kitchen staff must hold a health card representing that they have successfully passed the medical test and food safety training.
  • Local permit: This permit signifies that the kitchen is not causing inconvenience to the locality, and it is essential for a kitchen to work legally in the specific location.
Step 5: Plan your menu and operations:

After successfully setting up a convenient shared kitchen space and getting the necessary permits and licenses, the next step is to plan a menu. You should focus on:
  • Developing a menu that meets all the guidelines from the Dubai Food Safety Department
  • Carefully plan your kitchen operations, including order preparation, storage, and delivery options.
  • Plan your inventory.
  • Ensure that the customer care services and order management system work effectively.
Additional tips and considerations:
  • Update your services regularly after researching the market.
  • Ensure that the Cloud Kitchen has a reliable internet connection.
  • Introduce the best order management software to eliminate errors in orders.
  • Come up with new offers and ideas to increase sales.
  • Hire experienced and skilled staff, including chefs, managers and delivery drivers, for efficient work.
How much does a Cloud Kitchen Dubai license cost?

 A Cloud Kitchen Dubai license has different fees; annually, a permit costs around $540-$2700. Let's break down the potential cloud kitchen license cost in Dubai:
  • Initial approval fee: Before an actual license application is submitted, a mandatory fee of $54-$139 is paid to the authority to receive initial approval.

  • License Fee: The license fee varies for food establishments of different sizes. The cloud kitchen license Dubai cost around $270-$1350.

  • Health and Safety Inspections: Annual health and safety inspections cost between $135-$270.
What is the Kitchen Cloud Dubai?

Kitchen Cloud is a platform that provides cooking spaces on rent to entrepreneurs who are starting kitchen businesses. This Cloud Kitchen concept Dubai is getting popular as they work on the principle of “preparing delicious meals and delivering exceptional customer services” making it one of best Cloud Kitchen in Dubai.

Benefits of using Kitchen Cloud Dubai:
  • Flexible rental options: This Cloud Kitchen service provides kitchen spaces for as little as a few hours daily. It is a popular option for businesses because it offers flexible rental options.

  • Access to commercial cooking equipment: This platform also provides advanced, high-quality commercial cooking equipment. This approach helps the personnel meet high-end orders and improve the overall quality of food.

  • Location: Kitchen Cloud chooses a location closer to food delivery hubs, making it convenient and easily accessible. By doing so, they attract more clients to rent their kitchen spaces. It is a very strategic way to generate more revenue.
Here is a list of cloud kitchens in Dubai:

1. Kitopi:

Kitopi is a cloud kitchen platform with multiple brands and concepts, making it one of the best in Dubai. Through its website and mobile app, Kitopi Cloud Kitchen provides the best Italian, Mexican, and Indian cuisines and delivery services.

2. Kitch:

Kitch is a cloud kitchen operator offering a range of cuisines and delivery options. It provides food preparation and delivery services to restaurants and establishments and offers its brand of food products.

3. Kitchen Nation:

Kitchen Nation is a cloud kitchen platform that provides food preparation and delivery services to restaurants and food establishments. It offers a range of cuisines, including Arabic, Asian, and European, and provides delivery services

through its website and mobile app.

4. Foodsbiz:

Foodsbiz is a UAE-based cloud kitchen company that operates in Dubai. It offers a range of American, Italian, and Mexican cuisine and provides delivery services through its website and mobile app.

5. Deliveroo Editions:

Deliveroo Editions is a network of cloud kitchens operated by Deliveroo. It offers a range of cuisines. Deliveroo provides food preparation and delivery services to restaurants and establishments and offers its brand of food

products.

6. UAE Cloud Kitchen:

UAE Cloud Kitchen is a cloud kitchen operator offering a range of cuisines and delivery options. It provides food preparation and delivery services to restaurants and food establishments and also offers its brand of food products.

7. Dubai Cloud Kitchen:

Dubai Cloud Kitchen is a cloud kitchen operator that provides food preparation and delivery services to restaurants and food establishments. It offers a range of cuisines from Arabic, Asian, and European countries and provides delivery services through its website and mobile app.

8.KitchenHub:

KitchenHub is a cloud kitchen platform offering a range of cuisines and delivery options. By leveraging Kitchenhub's platform, food businesses can streamline operations, reduce

costs, and increase profit. It also helps in making connections with other industry professionals and experts.

 Ultimately, Kitchenhub provides a

one-stop shop for food entrepreneurs to launch, grow, and

succeed in the competitive food industry.

9.FoodFabrik:

FoodFabrik is a cloud kitchen operator that provides food preparation and delivery services to restaurants and food establishments. These cloud kitchens offer a range of cuisines, including American, Italian, and Mexican, and offer

delivery services through their website and mobile app.

10.SmartKitchen:

SmartKitchen is a cloud kitchen operator offering a range of cuisines and delivery options. It provides food preparation and delivery services to restaurants and establishments and

offers its brand of food products.

What is the future market of the Cloud Kitchen business in Dubai?

New trends in the market, like the increased adoption of technology, Eco-friendliness, and growing demand for healthy niche food options, are contributing to its peak growth. Researchers estimated that this sector in Dubai's growth rate from 2023-2030 will be significantly higher than the global average. The market will grow from $330.3 million to $821.5 million in seven years.

Conclusion:

Cloud kitchens are revolutionising how food businesses used to operate in Dubai. With the unique benefits of lesser operational costs, flexibility, and increased efficiency, these kitchens are exponentially coping with the growing demand for food delivery.

This business option provides a solution for a new entrepreneur starting a new food venture or an established brand expanding its services in other areas. As the market grows, cloud kitchens will be the future of food delivery in Dubai by 2030.

This can be a perfect time for entrepreneurs and food enthusiasts to invest in such ventures and seek opportunities to capitalise

the diverse population of business-friendly cities like Dubai.

Frequently Asked Questions

What is the average revenue generated by the average Cloud Kitchen in Dubai?

The values are not exact and vary depending on the business's size and location. A Cloud Kitchen in Dubai generates around $136000-$1.36 million of revenue annually.

How do I start my cloud kitchen in Dubai?
  • Register your business to obtain a trade license.
  • Meet all health and safety requirements.
  • Rent a cloud kitchen
  • Partner up with food delivery platforms
How can FoodsBiz help you in this journey?

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