Next time you order from DoorDash, look and see if the name of the restaurant lines up with the street address. If a different restaurant name appears, then you might have just ordered from a “ghost kitchen.” Many people aren’t aware they are participating in the trend of virtual restaurants, more commonly known as ghost kitchens. This is concerning considering there are plenty of problems that come with this business model, such as big chains operating covertly under different names to increase profit, inconsistent pricing across chains that operate under different names, and difficulties upholding health regulations. Ghost kitchens need better regulation that is made accessible and public to all.
Ghost kitchens are “restaurants” that tend to operate on low-rent or noncommerial properties, providing food that can be ordered online. They are considered virtual in the sense that multiple restaurants can sell food out of one space without providing any seating or dine-in options. This model of business became increasingly popular during the height of the pandemic, when dine-in restaurants were shut down and food delivery apps became popular. According to the food blog the Daily Meal, the amount of ghost kitchens has nearly quadrupled since 2021, increasing from 10,000 to 40,000 kitchens nationwide.
Ghost kitchens are an opportunity for already-thriving businesses to further dominate the food market. Chains and franchises operating ghost kitchens include Chuck E. Cheese, iHOP, Denny’s, Boston Market, Chili’s, and Outback Steakhouse, according to TastingTable. They sell under a different name and even operate under multiple restaurant names on online delivery apps — some even having up to four restaurants. This leads to duplicate menus, meaning these virtual brands will sell the same dishes despite claiming to be a different restaurant.
The same item can cost more depending on where you’re buying it from. For example, Denny’s operates a ghost kitchen under the name The Melt Down, which offers a brisket sandwich for $18.72, while the same sandwich costs $16.99 at Denny’s, according to CBS News. Traditional restaurants have begun to worry that these kitchens will push them out of business, as they can’t keep up with as many orders as a kitchen dedicated solely to orders from delivery apps and for pick-up.
There are certain telltale signs to spot these virtual kitchens. According to Business Insider, “DoorDash is the most transparent when it comes to identifying virtual brands” — they disclose the address that meals are prepared and label store pages as virtual brands. UberEats and Grubhub do not label restaurants as virtual. However, all three apps list restaurant addresses. Business Insider reporter Nancy Luna found that a MrBeast Burger in Orange, California was operating from a ghost kitchen that showed up as a Red Robin when she looked up the address provided by Grubhub. The restaurant confirmed in a phone call to her that the chain only sold MrBeast Burger.
More recently, ghost kitchens have faced obstacles. UberEats has removed more than 5,000 ghost kitchens from their platform as of March this year, and they require 60% of a ghost kitchen menu to be unique from its parent restaurant, according to the Washington Street Journal. These ghost kitchens must also maintain a 4.3 star rating or higher and have fewer than 5% inaccurate orders and cancellations, or they face being kicked off the platform. However, this is just what UberEats has implemented — there are still many platforms that ghost kitchens can operate through, such as DoorDash, Grubhub, and Postmates, and this barely chips away at the estimated 40,000 ghost kitchens on UberEats.
Another concern with ghost kitchens is how to cite health violations. In San Francisco, the Department of Public Health’s (SFDH) green, yellow, red placard rating is required to be clearly and visibly posted inside a restaurant. Luckily, San Francisco has every ghost kitchen listed on a public database on the SFDH website, but not every city is as thorough. Not only is it hard for consumers to know ghost kitchens’ ratings due to their lack of a physical space, there is also concern about how to rate them. Having multiple restaurants in one space creates confusion about how a health code violation should affect each restaurant.
Ghost kitchens have caused an overwhelming number of problems in the restaurant industry since taking off during the pandemic, such as price inconsistencies, health code violations, and hurting small businesses. It is important to stay alert and know where you are ordering your food. Until there is greater regulation of ghost kitchens, look out for businesses on food delivery apps that have virtually identical menus, and don’t be afraid to look up the address of the place you’re ordering from — you may be unknowingly overpaying for chain restaurant food or ordering from a business that doesn’t operate with adequate or easily accessible food service standards.
