Ghost Kitchens - Buttressing the Business Opportunity with IPRs

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The year 2020 saw the emergence of an unpalatable, unprecedented global catastrophic ‘phenomena’ – the COVID-19 pandemic and the following lockdown. The global gross domestic product declined by an estimated 6.7 percent as a result of the pandemic, leaving a far-reaching scar on almost every nation on this planet. However, the opening of the pandora’s box has also led to an increase in the services’ sector.

The food delivery industry has become a global market worth more than $150 billion, having more than tripled since 2017. Let alone in the United States, the market has more than doubled during the COVID-19 pandemic, following healthy historical growth of 8 percent. A report by the National Restaurant Association of India indicates that food delivery now contributes to around 33% of the total restaurant revenues as opposed to 10% pre-COVID. Enter the role of food delivery apps – Swiggy and Zomato, new brands emerge every month, many of which are delivery-only. And it is a major development following the pandemic that we have the emergence and the rise of cloud kitchens.

Fig. A cloud kitchen outfit in action during the COVID-19 pandemic

Also known as ghost kitchens, shadow kitchens, virtual, or dark kitchens, these are delivery-only restaurant outfits, which do not offer dine-in options. They rely only on online orders, usually placed through online food aggregators. Essentially, ghost kitchens have no physical storefront. Cooks prepare food for delivery or take-out, and no dine-in options are available to customers. Ghost kitchens typically leverage websites, social media, and various third-party apps to reach their customers and offer alternative means for restaurants to continue operations and generate much-needed revenue.

According to a report by RedSeer Management Consulting, cloud kitchens are set to be a $2 billion industry in India by 2024, up from $400 million in 2019. Before the pandemic, there was a distinct divide between delivery centric focussed and dine-in brands. However, the specification will be completely altered in the upcoming years. With the business model still in its infant stages in India, a boost in innovation and technological advancements could increase the operational efficiencies of ghost kitchens. Some of these areas include the more effective reduction of food wastage, the ability to forecast demand more accurately through harnessing big data, as well as the speed and quality of the food preparation process. All of these technological advancements will foster the increased generation of Intellectual Properties which needs suitable protection. Following are the relevant IPRs with respect to cloud kitchens in India.


Cloud kitchens centre around disentangling the menu with the goal that more automation can be instigated. Cloud kitchen companies have effectively automated all the packaging processes. These processes add to about 25% of the total workload. A great deal of pre-planning activities has additionally been completely automatized. Cloud kitchen start-ups are trying to explore and bring new technologies which will allow the whole process to be automatic. Various automated machines and robotic arms are being used in cloud kitchens.

Fig. An IoT-enabled robotic teamaker device

Sunshine Teahouse, the parent of Indian tea chain Chaayos has applied for patent ‘Chai Monk’ which is an IoT-enabled teamaker bot.


With an increase in the market for cloud kitchen, there is an evident growth in the competition as well. Obtaining a trademark registration will not only help the business of a cloud kitchen to create its unique identity in the market but will also aid in the protection of its brand. The owner of the business must file an application for registration of the name, style or logo as its intellectual property with which its brand could be identified and which could not be used by any other brand.

Fig. Major cloud kitchen brands in India

Charcoal eats, Chaayos, etc have all been registered as trademarks in India. In addition, the ghost kitchen operator should purchase all domain name variations and ad keywords to prevent a possible infringement.


From promotional pictures, videos and images, till the interactive menu and softwares, Ghost kitchens will have to make sure it has acquired copyright protection on its portfolio. The field is competitive, and interlopers have been known to take others’ intellectual property.


Trade secret protection for recipes is crucial for cloud kitchens, as they usually operate in close contacts and proximities with other brands. Employers should have contractual protections with non-disclosure agreements and non-competes. Former and current employees need to know they must not share recipes, and they should face penalties for so doing.

With a number of other licensing requirements to be fulfilled as well, cloud kitchens have to face a number of challenges like high competition, reduced customer interacts and dependency on online food ordering apps. However, the right form of IP-protection coupled with a highly improvised and flexible marketing strategy would be decisive in the rise of cloud kitchens in India.