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The following video transcript is generated automatically by a computer algorithm that learns and gets better on a daily basis. Please accept our apologies if some content below doesn’t make sense:

Let’s talk about some of the risks associated with the dark kitchen business model. We’re just going to go through what a few of the risks might be, the likelihood that they’re going to happen and the kinds of impacts that they can have. What you want to be doing with these is thinking about ways in which you can plan or strategize for minimising the downside if these things are going to happen. Luckily, dark kitchens generally are a fairly low risk business model. You’re not doing anything too crazy, particularly if you’re subletting equipped modular kitchens to customers to rent and produce their own food stuffs in and produce their own food brands. Then that’s very low risk. Really, what you’re doing is you’re just a landlord at that point. And the people in the kitchens have incentive to keep not destroy the kitchen equipment or treat anything too badly, because that’s also the raw materials they need to produce their product and their output. So a lot of these risks are either not on your shoulders or the incentives are aligned with the people, your customers, if you’re producing or selling your own food. If you’re following one of these models where you create your own brands, your own food, then that’s slightly higher risk. But it’s still medium risk of sea. There are issues with food and hygiene and customers and things like that. But again, we’ll go through what these points are. So what we’re talking about here is likelihood how likely these kind of problems are crop up and the size of the impact of some of these problems. So starting in the top medium likelihood, high impact one, there is loss of distribution. Maybe he set up in an area and the. Food delivery apps decide to pull out of the area. For whatever reason, an obvious way to help to minimise the impact there is to make sure that you have more than one source of distribution in the area. So don’t just be on one app. Be on mobile apps. Don’t just rely on the apps themselves. Find other ways of distributing your food, your own riders, your own delivery people, things like that. So that’s that’s a relatively simple one to mitigate, but could have quite a high impact. Another one, there is regulation change. So maybe the local council changes its food hygiene regulations. Maybe it changes its zoning or planning regulations, meaning the place in which you set up your now no longer allowed to operate a restaurant from that area. The way to keep ahead of something like this is to keep your ears the ground with the local council, with the local government, and get a feel for what might be coming down the pipeline. Oftentimes, laws and regulation changes, things like that don’t happen overnight. You’ll get a lot warning that something’s going to happen here. So you want to be listening out for it. You want to keep on top of what it is that the council is doing. So the planning department, the Food, Hygiene, Health and Hygiene Department, just keep in contact with them and just see what’s happening down the line. You will you will get a good 18 months, two years warning if something might be happening and you can strategize and plan around that low likelihood. But high impact technology failure, either your own technology or third party technology, something falls over and, you know, all hell breaks loose. The way you want to mitigate these kind of problems is you want to make sure that you’ve got fallback plans. So if your order creation system, so the screens that you’ve got in your kitchen, which are showing what the orders are coming in to the chefs to prepare the chefs, what’s the backup system for that if that screen explodes or the software system goes down? Do you have a backup for that kind of thing? Typically, a way of doing that is by having printer print off the orders at the same time as they’re being shown on the screen. So then at least if the screen goes on the fritz, you’ve got a paper version of the thing that you can refer to. Obviously, there’s a variety of different ways of creating fallback plans for these kind of things that would be dependent upon your systems. But every time you implement a process or implement a system, particularly one which is key, also plan for and implement a fallback system that everyone knows about and practises at the same time. Medium likelihood, medium impact, neighbour problems. So if you are set up close to residential areas, is the food smells or noises coming out the kitchen going to cause an issue of light pollution, something like that? You want to make sure that ideally you don’t set up to close to any specific house or any specific residential place. You want to make sure that anything that you’re doing stays within the bounds of what is typically happening in that area. So, for example, if there are Russians in their area, you want to make sure that nothing you do is worse than what the existing restaurants are doing. So at least at least then you’ve got the legal side of things on your side. The council inspectors and things like that are going to be saying that all of this stuff is within the usual parameters. So just cheque and see where those edges always where those boundaries are. Low likelihood, medium impact. Here we’re talking about food hygiene problems, food poisoning. This is something that is, you know, relatively rare but can happen. You just want to make sure that you’re on top of all of your hygiene processes. You want to make sure that you are dealing with reputable distributors. You want to make sure that your staff are trained and inspected on a fairly regular basis to make sure that they’re actually sticking by the various rules and regulations. If you stick to them, the likelihood of anything like this happening is going to be fairly low. But also plan for the event when it will happen. You’re going to have to have a plan that you can pull off the shelf and start to operate on if something like this happens. Now, this is going to be a marketing plan to try and minimise the damage in the local area. This is going to be some sort of compensation plan. Is there some way that you can sort of help the people who’ve been hurt by this? But again, just think her and have an idea of what you might want to do. Low, low likelihood. Low impact. If all of the apps go away, so if there are no free delivery apps operating in the area or they were operating in the area but now have disappeared. What can you do about that? Now, again, this is similar to general loss of distribution. The solution to this is just to have multiple sources of distribution, multiple ways of distributing, marketing and distributing your food products. Riders and sharing drivers with other other operators in the local area. Are there already restaurants who have their own drivers who are out and about and maybe on utilise to their full? Why not share share the burden, you know, with those restaurants and pay half their salaries, pay half their fees, whatever that might be?
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