The State of Commercial Kitchens

The food and beverage industry has to rank near the top of business sectors most changed during the pandemic. Before March 2020, many of us would have scoffed at using QR Code menus or eating outside of the middle of winter.  Other big industry changes relate to how food is produced and how new businesses emerge and grow.  On this latter front, shared use or commercial kitchens are becoming an important part of the food industry landscape.

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A new survey, from researchers at Colorado State University and the US Department of Agriculture, examines what’s happening in the commercial kitchen industry.  The 2021 survey captured insights from 179 entrepreneurs currently operating out of shared use kitchens around the US.  It finds that most of the surveyed companies are young, and began operations at home before moving to a commercial kitchen. Business owners come from diverse backgrounds, and the share of minority-owned kitchen businesses is larger than that found in other industry sectors. 

In terms of company performance, most of the businesses are growing—even though average annual sales remain relatively low at just under $40,000 and average annual profits fall below $5,000.  These low numbers may be concerning as 59% of respondents view their food business as their primary occupation.  The potential good news is that older businesses tend to perform better and that most survey respondents view the commercial kitchen as critical to future success. Overall, 67% percent of respondents expect to grow in the near future.  Overall, the survey suggest that new food entrepreneurs view commercial kitchens as an important community and business resource.