CNBC reports that Kroger is teaming up with ghost kitchen start-up Kitchen United to expand the building of in-store facilities specifically designed to prepare meals for pick-up and delivery.
According two the announcement, "The off-premise restaurant kitchen powered by Kitchen United at participating Kroger locations will feature up to six local, regional or national restaurant brands. When placing an order using the Kitchen United website or app or on-site via ordering kiosks, customers can select items from each on-site restaurant to create a customized order on a single receipt. Restaurant staff will prepare the orders and delivery service fees will be determined by third-party providers."
The companies said that "the first kitchen center is expected to open this fall at a Ralphs store in Los Angeles, with additional locations expected later this year."
"As we continue to define Kroger as a food destination, this collaboration creates another seamless way for our customers to order lunch or dinner for pick up while they shop for groceries or for delivery to their location of choice," said Craig Gauden, Kroger's director of partnership development.
"Kitchen United recognizes the significant value of Kroger as a strategic partner. Our work together provides participating restaurants access to millions of Kroger customers and the ability to better address off-premise demand in a convenient supermarket format – a frequent destination for most consumers," said Michael Montagano, CEO of Kitchen United. "We've worked collaboratively with the Kroger team to curate a mix of popular restaurant brands, and we see a great opportunity to introduce our partnership in cities across the country."
CNBC notes that retail partnerships have proven to be a fertile ground for ghost kitchen companies: "Earlier this year, Westfield Valley Fair mall in California said it would use Kitchen United’s technology to help it facilitate to-go orders. Other malls have also turned to ghost kitchens as a way to raise foot traffic and boost restaurant sales. In 2020, mall operator Simon Property and Accor, the hotelier, teamed up to launch C3, a virtual kitchen company."
- KC's View:
I've believed for some time that we're about to see enormous competition in the food retailing business, especially because the sectors that were hit hard by the pandemic are going to be looking for ways to a) regain lost ground, and b) diversify their models in a way that could be more sustainable when the next pandemic comes.
Which means that it is very smart for Kroger to move in this direction.
What I really want to see is Kroger deciding to invest in ghost kitchens down in Florida, where it already is launching a pure-play e-commerce model. The results of such a test could tells us a lot about how the traditional supermarket industry is going to evolve going forward as they look to meet consumer needs.