DoorDash announced Thursday that the third-party delivery company is expanding its DoorDash Kitchens ghost kitchen network to a second city — San Jose — and is now offering full-service operations capabilities for partner restaurants through a new ghost kitchen revenue sharing program.
DoorDash Kitchens Full Service will expand outside of delivery/takeout capabilities to equip operators with DoorDash-facilitated operations and front of house staff, kitchen staff training, supply chain ingredients, and day to day operations. In return they’ll receive an unspecificed percentage of profits.
“When we launched DoorDash Kitchens, it was with the goal of helping our restaurant partners expand their geographic footprints, and as the restaurant industry has evolved, we've evolved our approach with it,” Ruth Isenstadt, director of DoorDash Kitchens told Nation’s Restaurant News. “And so, in this new model, we're providing a flexible and cost-efficient growth opportunity for restaurants where we are actually kind of managing the full end to end operations for them. […] I just view this as another service that we can offer to restaurants in a delivery and takeout-focused way.”
DoorDash Kitchens launched in 2019 in Redwood City, Calif. and has now expanded to the San Jose region with the opening of a new popup kitchen (which soft launched in April) featuring six restaurant partners with both West and East Coast followings: Aria Korean Street Food, Canter’s Deli, Milk Bar, Curry Up Now, The Melt Express and YiFang Taiwan Fruit Tea. In Redwood City, DoorDash has a mix of full-service and traditional ghost kitchen business models, while the San Jose partners are all operating with DoorDash Kitchens Full Service.
The new service is designed for small operators that want to expand to new cities or markets without building a brick and mortar restaurant. DoorDash Kitchens Full Service could become a major competitor to virtual restaurant industry stalwarts Reef Kitchen and Kitchen United as it similarly offers a full menu of services and not just a place for virtual brands or ghost kitchen expansions to operate from.
DoorDash has taken a flexible approach to the Full Service model, letting operators choose what they want DoorDash to take on, and which services they can do on their own. For example, with the staffing component, DoorDash either hires cooks or partners with a culinary operator like A La Couch to outsource front of house and operations staff to make sure the facility is running smoothly. For ingredient sourcing and training, DoorDash asks operators to provide menus and lists of ingredients and work with them to create consistency across all of the restaurant’s locations, including the virtual ones, and offers tastings and plating trainings to make sure everything is executed correctly.
Criticisms aimed at the influential third-party delivery industry take issue with restaurant operators becoming dependent on companies like DoorDash and then only reap a certain percentage of the profits of their own restaurant, either through delivery fees or this new revenue sharing service. But DoorDash sees their services as opportunities for small businesses to expand their reach thqt would not otherwise have the resources to do so:
“This is a way for them to expand to new geographies in a very capital-light way and low-touch operationally,” Isenstadt said. “To me, it actually is about giving them more options and more ways to get their name out there faster with less capital than they might have.”
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