Entrepreneur

Why Ghost Kitchens Are the Next Big Thing for Food-Service Franchises

As consumers embrace delivery services, restaurants are ditching their eat-in spaces -- and finding big savings.
Source: Nicolas Oretega
Nicolas Oretega

Dog Haus is the kind of place designed to spend time in. It serves dogs, burgers, beers, and the like, and its wide-open space captures the vibe of a beer hall -- industrial but clean, with high ceilings, wall-size graphics, reclaimed-wood-and-steel tables, and music trendy enough to draw in young customers. The first time Jesse Koontz checked it out, he wanted to spend more time there, too. “I just immediately fell in love with the concept,” he says. “I walked in and was like, ‘This place is cool.’ ”

Koontz set out to become a franchisee, and in 2018, he opened his own Dog Haus, now one of 34 spread across 10 states, in Chicago’s Lincoln Park. Shortly after he opened it, Koontz started thinking about a second location. He wanted one closer to downtown Chicago, where foot traffic is especially high. But the cost gave him pause. A full Dog Haus launch can cost more than half a million dollars. Did he really want to take another gamble that big?

What he really wanted was a way to test the market first. Then he realized he could -- but it would require ditching almost everything Dog Haus is known for. No high ceilings. No art on the wall. No tables where could sit and snap Instagram photos of their pastrami- and arugula-piled

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