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Ghost kitchens ride into college campuses on the backs of delivery bots

Universities turn to robots to address labor shortages and explore new businesses

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cartken delivery robots lined up at ohio state university
Image Credits: Cartken

The relatively controlled environments of university campuses have long served as ideal testing grounds for autonomous technology, and they’re proving particularly effective for sidewalk delivery robots.

In the latest move to introduce autonomous delivery to college campuses, early last week, food delivery platform Grubhub and sidewalk delivery robot startup Cartken shared plans to bring 50 food delivery robots to Ohio State University this fall. An expansion of their spring semester pilot of 15 bots, the plan is to have around 100 Cartken robots delivering around OSU by the end of the school year.

A closed, geofenced environment allows companies to test higher levels of autonomy as there are fewer edge cases and difficult scenarios, like busy intersections. And campuses typically have neatly paved sidewalks, which are perfect for the small wheels of delivery robots.

As more universities around the United States slowly become home to such robots, they’re finding that the bots are not just a neat new feature to appease hungry students or promote their willingness to welcome innovation. Universities are now relying on bots to both address labor shortages and explore new business opportunities, such as delivery-only kitchens, popularly referred to as “ghost kitchens.”

“Universities are starting to see the opportunity to marry that concept of running multiple restaurants from a production facility and tying that to robotics. It allows them to pick a central point on campus that’s operationally or logistically beneficial, and then build a whole set of virtual restaurants that can only be delivered through robots,” Benjamin Anderson, Grubhub’s director of campus business development, told TechCrunch.

The lay of the land

Universities are no stranger to autonomous delivery robots, but startups are now steadily increasing their presence on campus sidewalks.

Grubhub is only expanding on its previous work with its new plans — the company previously worked with OSU and the University of Arizona to deploy Russian internet company Yandex’s autonomous rovers. They were popular with students, the people involved said, but Grubhub, like many Western companies fearful of the taint of war, pulled out of that partnership when Russia invaded Ukraine.

This is, however, Cartken’s first foray into university delivery. Earlier this year, the startup partnered with Mitsubishi to bring delivery to certain malls in Japan and is also working with REEF Technology to deliver from ghost kitchens in downtown Miami.

Larger rival Starship Technologies, arguably the leader in the space, has been deploying robots on campuses for years. The startup, which last raised $42 million in December, operates in 30 colleges around the U.S. and will announce more partnerships in the coming months, the company said.

While Starship historically operated the delivery service with universities’ dining partners, the company now plans to provide a “delivery as a service” model that allows retailers, delivery platforms and others to utilize its automated delivery platform, a spokesperson told TechCrunch.

Last year, Kiwibot partnered with Sodexo, a food services and facilities management giant, to bring its bots to New Mexico State University, Loyola Marymount University and Gonzaga University. The company has since added Endicott College and has a couple more colleges currently in pilots or signing new contracts. It has a total of 200 robots operating on 10 campuses and plans to rapidly expand by the end of 2022, according to a Kiwibot spokesperson.

Who needs a restaurant when you have a kitchen and a bot army?

Everywhere in the world, the pandemic caused much suffering for on-campus restaurants. Many had to restrict operating hours or shut down, leaving many students without easy access to food. On top of that, the increased demand for food delivery during the pandemic combined with workers’ understandable fear of exposure to COVID-19 exacerbated existing labor shortages in the hospitality sector.

Suddenly, many students were stranded in food deserts, and colleges were loath to operate full-scale restaurants in areas that don’t get enough traffic to make for a viable business. Delivery robots, therefore, became a necessity that allowed many college campuses to keep certain restaurants afloat and ensure students were being fed.

That hasn’t changed. Even as indoor dining opens up, students are now used to getting food delivered, and it’s proving useful.

A recent Starship survey of over 7,000 students found that 93% of students found the robots to be convenient and helpful. Nearly two-thirds said they could study more because they could get food when and where they need it, and that they didn’t skip meals anymore because they didn’t have to wait in long lines. A third said they felt safer on campus because of the contactless delivery offered by the robots.

Zia Ahmed, senior director of dining services at OSU, said during the six months Yandex’s rovers were on campus, delivery more than doubled, and rovers accounted for 65% of the total delivery portfolio.

Combine this hearty appetite for on-demand food delivery with labor shortages and a lingering fear of interacting with other people, and you’ve got a recipe for new, lucrative opportunities with delivery-only kitchens.

“If you think about it, almost every kitchen in today’s world, post-pandemic, is a ghost kitchen, because every restaurant is doing delivery now,” Ahmed told TechCrunch. “[OSU has] one, and we’re definitely seeing a growth in college universities, because ghost kitchens don’t have to take up prime real estate, and you don’t have to worry about building a fancy front of house or staffing it for serving walk-ins.”

Starship confirmed to TechCrunch that it delivers from ghost kitchens at several universities. Some of these kitchens were started to help meet demand for deliveries during typical hours or late at night, which Starship says have seen the most dramatic rise.

The University of Houston is one such campus. It recently successfully trialed a ghost kitchen concept called “Cougar Crunch,” a breakfast-themed, late-night ghost kitchen that uses 26 Starship robots and features jumbo-sized cereals, pints of milk and toppings. This fall, UH will test a series of pop-up ghost kitchens for its new retail center, called “The Hub.”

“The pandemic caused us to think outside the box, and ghost kitchens were a creative concept that emerged,” Charles Pereira, vice president of operations at UH, told TechCrunch. “Using existing kitchen infrastructure, whether in a closed retail location or a slower residential dining or catering kitchen, is a great way to provide additional food service without the need for additional equipment and infrastructure.”

Another Starship client, North Carolina Agricultural and Technical State University, has implemented a ghost kitchen called 1891 Revolution. This kitchen features a rotating menu that includes MrBeast Burgers, hibachi and Mexican concepts, according to Angela Peterson, associate vice chancellor for campus enterprises at the university.

Kiwibot, too, has dabbled with ghost kitchens. The company said it set one up with Brandeis University that involved three brands that use kitchens from other restaurants: MrBeast Burger, Mariah’s Cookies and Buddy V’s cakes.

Even if a university hasn’t opened up a ghost kitchen, it can still use some of those concepts. For example, a restaurant that used to be open until midnight but now closes at 9 p.m. might be able to squeeze in a few more hours of service for deliveries only, Anderson said.

He added that he’s seen a deliberate effort on the part of universities to target parts of campuses where there is a low food service footprint.

The unit economics of ghost kitchens and robots

The universities TechCrunch spoke to all report the same thing: Delivery bots cost less than human delivery drivers, are more reliable and deliver food faster.

Most companies are unwilling to share the cost of their robots, but to give you a ballpark idea, Kiwibot has reportedly charged universities around $1,300 per robot, per month — about the price of a new MacBook. Kiwibot did not confirm this number to TechCrunch, instead saying that it can adapt to its customers’ needs.

For students, the costs are also much lower. Starship charges a $1.99 delivery fee while Grubhub charges $2.50 — neither charge a service fee, which certainly makes a difference for customers who get deliveries often.

The unit economics are, unsurprisingly, favorable for companies like Grubhub and DoorDash that still haven’t cracked profitability despite record revenue growth and controversial practices like classifying gig workers as independent contractors.

That doesn’t mean, however, that delivery robots are without cost. Students messing with the bots can at best lead to less efficient deliveries and, at worst, break the bots. The devices also still require humans to clean, repair and charge them, and they still mostly all fall back on humans located in a service center far away for help getting out of sticky situations.

College campuses as trendsetters

Both Anderson and Ahmed said they expect delivery robots to begin expanding to off-campus neighborhoods where there are large populations of students so that the university kitchens don’t lose that source of income.

Innovations on university campuses are often a bellwether of wider changes, and the pandemic has accelerated the growth of ghost kitchens everywhere, not just at universities. According to Euromonitor, ghost kitchens could create a $1 trillion global market by 2030.

“We pay very close attention to the industry when we are serving our students, because we are, in so many ways, developing the future consumers of food,” said Ahmed. “A lot of the behaviors that they adopt in college campuses — they’re going to continue to behave that way when they go into the outside world.”

Correction: A previous version of this article stated Grubhub deployed Yandex bots at Arizona State University, rather than the University of Arizona.

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