8 Facts About Chefus
In Jan 2021 I wrote an article about Chefus.com, a new Bay Area cloud kitchen + food delivery start-up. The article attracted 10+ investors to contact us. Given the popularity, I decided to reveal 8 more facts about it.
Central Kitchen in San Jose and in SF
Unlike platforms like Doordash/UberEats that delivers restaurant food, we have our own kitchens! Currently we have 2: one in SF, another in San Jose, (although the SF one is not in operation due to county COVID-related policies).
This means our dishes are cheaper than those on the delivery platforms because we cut out the middle man — the restaurants and the platforms, and we control the production of dishes so they can cater to the customers’ tastes: more on this later.
Batch Cooking and Amazing Efficiency
We are not on-demand. Instead, you need to order in advance, slightly: 9am is the cutoff time for lunch orders, and 2pm is the cutoff time for dinner orders. Then, take lunch as an example:
- At 9am, we get the final numbers for each dish
- 9am-10am, 4 chefs finish cooking 600 dishes
- 10am-10:30am, we finish packing them into 150 orders
- 11am-1pm, they get delivered to the customers
At a normal restaurant, 1 chef cooks 3 dishes per hour.
Batch cooking tremendously increases efficiency, which means cost per order is a lot lower than at traditional restaurants.
Wide delivery range — 40 miles
In 2 hours’ time, our 10 drivers deliver 150 dishes from our San Jose kitchen all the way to SF and Tri-valley — a 40 mile range! For a normal restaurant, the range that it can deliver is usually 3–5 miles.
For Doordash/UberEats, on average, 1 driver delivers 1–2 order per hour. But each of our driver delivers 10–15 dishes in a 2 hour time window — this is possible because of our batch delivery model.
As a result, our delivery fee per order is much cheaper — it’s $0 if the order is above $25 ($2.99/order otherwise) and 90% of our orders make the free delivery threshold.
Fresh Ingredients From Farmers and Fisherman
Co-founder Allen Shi has been working in the food/restaurant industry for… his life time. He opened up 4 different restaurants between 06 and 17, including the famous China Lounge 味道成都 in Pleasanton.
As a result, he has great connections with local producers: farms and fishermen. Instead of going to a middlemen, for our seafood and fruit, we go directly to the farmers and fisherman. (For other, we get them from the distributor.)
And because of our batch model, we buy in quantities much larger than restaurants, and as a result, we get the freshest ingredients at amazing price — same price as what supermarkets can get.
Revenue Sharing model with chefs
At restaurants, chefs are employees — they get a fixed wage, and don’t directly benefit (or lose) from the fact that they cook good (or bad) food. The only way to profit is to open up their own restaurant, but not all chefs are good businessmen.
At Chefus, chefs are partners: they get 53% of the revenue on the dishes they cooked and pay for the cost of his/her own ingredients, while Chefus gets 47%, and cover everything else: direct labor (packing, delivery, customer service), overhead (e.g. web development), marketing, rent and utility.
This means chefs are empowered: they can focus on their core competency — cooking, not having to worry about anything else, while still making 50–100% more than if they were to work at a restaurant!
High User Engagement
So far, majority of our customers are first-generation Chinese immigrants (which showcases the authenticity of our dishes :) and we interact with them via a few large WeChat groups.
Take Jan 12th as an example: a few customers posted in the group that, the bamboo shoot was too salty. The customer service person took note of that right away. The info was passed to the kitchen, and the problem was fixed in the dinner batch.
In normal times, users would engage with each other and with our customer service person in the group on a daily basis for all kinds of topics: ‘they finally have xxx again! hurry up and order it!’, ‘where’s my order?’, ‘when will my order arrive?’ and complaints such as in the above example. Some people would treat the group as a place where they chit-chat — not something you’ll find for other food delivery platforms, or business-ran WeChat groups :)
Best seller dishes that came from customers’ requests
In fact a lot of our best sellers, such as 跷脚牛肉 (a traditional beef stew originated from the Szechuan province Leshan area) and 鲜肉月饼 (Mooncake with meat filling), was proposed by our users.
This is possible because we are in such close contact with our users via WeChat groups. Also, 80% of our users were acquired organically — people who are already our users would invite their friends into our WeChat groups simply because our dishes were so good.
This will not be possible on platforms that simply delivers restaurant food to users: if users do not like something, the best extent to which they can provide this feedback is to leave a low star review, not to mention proposing new dishes and asking for adjustments.
Huge Variety of Dishes… and Growing!
Unlike a traditional restaurant that carries 20–50 SKUs, we have (as of now) 4000 SKUs in our data base (i.e. all the dishes we’ve ever offered). Each Sunday, we upload our menu for the next week. There are many different categories: the hot dishes change daily, while items under appetizers, starch, hot pot, etc. remain the same every day.
And we’re constantly introducing new menu items are new chefs & customer requests flow in. On average, we have 5 new items per week, or 1 new every day. This is also another reason why customers keep coming back: there’s always something new they want to try :)
The Punchline
Although we’re young — we started in Mar 2020, we’ve already gain amazing traction — 2M revenue in 2020, and is growing continuously. We’re hoping to revolutionize the food industry by empowering chefs and bringing healthy, tasty and affordable food to our customers. Contact us if you’re interested in investing in us, or would like to partner with us! We look forward to redefining food together with you.
