San Francisco Restaurants Are Going Virtual Because Of The High Rent
You may have heard that San Francisco is one of the most expensive rental markets in the country. You may have heard it’s possible to pay $1,200 a month for a bunk bed there and that more restaurants are closing now than opening. You may have heard that third-party delivery services are charging restaurants double-digit commissions, up to 30%, plus other hidden fees. So how, you may be wondering, does a struggling restauranteur manage to stay in business?
They do it by going virtual. Instead of having a brick-and-mortar space, they switch to an all-delivery model, which means they can operate anywhere, as long as they have an oven and a system for taking orders.
ABC7 News in San Francisco interviewed one such restaurant owner, Rick Richman, who runs his Mission District pizzeria, Firepie, out of a few trucks in a parking lot. He told ABC7 that delivery was more becoming more popular than dine-in anyway, and this was the only way he could afford to stay open.
Ever helpful, Uber Eats has created a guide to opening a virtual restaurant; it promises business-owners that “this program allows you to create new brands and deliver new cuisines to customers, without the risk and expense of opening another physical location.”
ABC7 talked to an expert who described going virtual as “an operational nightmare” and predicted that the outcome won’t be smaller virtual businesses but an influx of chains, who can afford to pay the rent.