retail news in context, analysis with attitude

The New York Times has a story about so-called "ghost franchises," which takes the "ghost kitchen" concept to the next level:  "In the delivery app era, the ghost franchise can be a lifeline for the independent restaurateur, a way to make thousands of dollars a month in a devastating time. It can also be a liability, exploding the marketplace in ways that serve big brands more than small businesses."

An example is Mr. Beast Burger, which builds on a brand established on YouTube:  "But MrBeast Burger is not quite what most of us think of as a chain, or even a restaurant. In exchange for a cut of sales revenue, the brand supplies the name, logo, menu, recipes and publicity images to any restaurant owner with the space and staff to make burgers as a side hustle. When a customer orders from the MrBeast Burger in Midvale, Utah, the food is prepared at a location of the red-sauce chain Buca di Beppo, following a standardized MrBeast recipe. In Manhattan, a MrBeast Burger is prepared at the neighborhood bar Handcraft Kitchen & Cocktails."

According to the Times, "The business model hinges on deals the ghost-franchise parent companies strike with third-party delivery apps (which are notorious for taking advantage of workers and restaurants), using the leverage of having hundreds of listable 'restaurants' to broker top spots for them in search results … even an independent restaurant can get a virtual brand up and running in less than 30 days, with few limits to the number of brands one owner can take on. And that potential speed of proliferation could result in a delivery-app ecosystem where the ghost-franchise parent companies duke it out at the top, while the truly independent restaurants are pushed farther down the list."

KC's View:

Hard to be critical of anything that keeps restaurants in business and people employed.  In fact, I have to wonder if it only has to be restaurants that adopt these ghost franchises.  Why not supermarkets?  Or even hotel kitchens?

The trend illustrates the degree to which virtual businesses can, through sheer marketing power, create actual businesses.  It isn't all smoke and mirrors - there's actual business going on here.

The biggest problem I see is potential inconsistency, but that could be less of an issue than I think - people may want something different from their burgers in Texas than they do in Manhattan, and so a little local flavor could be a good thing.