GrabFood launches its first shared kitchen in Singapore

SINGAPORE — GrabFood has become the latest food delivery operator to launch a kitchen space housing multiple restaurant brands, turning the heat up on competition among Singapore’s three major food delivery services.

Residents in the Upper Bukit Timah, Bukit Batok and Bukit Gombak areas can now order food items from more than 10 brands, including Wolf Burgers and PlayMade, in a single order through the app. Orders can also be made for pick-up or consumption in the kitchen’s dine-in area in Hillview.

Deliveroo and Foodpanda already operate their own shared kitchen spaces, also known as ghost or cloud kitchens, in Singapore. The concept has been catching fire as demand for food delivery grows and eateries use it as a way to expand or create new brands without the costs of setting up a dine-in establishment.

Former Grab Singapore head Lim Kell Jay, who now heads GrabFood’s regional operations, said at a media briefing on Wednesday (Jan 8) that the GrabKitchen launch in Singapore brings its network of cloud kitchens to 50 across five countries in the Southeast Asian region.

There are plans to open more kitchens in the coming year, he said, but did not disclose how many are in the pipeline.

More services for merchants, such as a bulk procurement platform for kitchen supplies and ingredients, will also be rolled out this year.

GrabFood, which is in seven countries, saw more than five times’ growth in gross merchandise value and a 173 percent increase in active users last year, Mr Lim said.

The launch of the first GrabKitchen here comes amid an ongoing investigation by the Competition and Consumer Commission of Singapore (CCCS) into the online food delivery and virtual kitchen sectors.

The investigation, announced in October last year, was prompted by a shared kitchen operator’s complaint that it had been shut out by Deliveroo and GrabFood.

Smart City Kitchens (SCK), which is linked to ousted Uber chief executive Travis Kalanick, opened a 13,000 sq ft facility in Tampines in June, touting itself as the first operator here to be unaffiliated to a delivery service. Tenants said the two delivery services had blocked them from listing on their platforms.

GrabFood Singapore head Dilip Roussenaly said on Wednesday that while GrabFood is contributing to the investigation process, it is not the subject of the investigation.

“We started not too long ago to work with some of the merchants out of SCK in the East. The main reason is we want to support merchants regardless of where they are,” said Mr Roussenaly.

GrabFood did not comment on the cost of the 6,000 sq ft kitchen space or its commercial arrangements with businesses renting the space, but said that it does not enforce exclusivity agreements and tenants are free to work with competitors.

Mr Ian Lin, who operates three restaurant brands out of a 17 sq m kitchen unit in the industrial building, said he took the opportunity to create his first delivery-only brand, Lady Boss Mala, to cater to demand in the area.

His other two eateries – Thai Dynasty and Bowl and Grill – have units in foodcourts here.

“Signage in a foodcourt alone can cost $3,000, and manpower is another big point of savings,” Mr Lin said of his decision to join GrabKitchen.

“The bulk procurement platform would be a useful option too because it’s no secret that in food and beverage, the margins are thin, so anything that can help to reduce operational costs is good.”