How one startup is reinventing the restaurant
A few beeps and you know the food is done inside a specially designed, proprietary oven at the Wonder location on the Upper West Side of Manhattan, New York. A whoosh of hot air keeps the temperature up when the oven opens, one of many design details in this kitchen that’s bent on efficiency.
On the outside, Wonder looks like a typical fast-food place — a handful of tables for eating takeout, a counter. But it is not typical.
“There’s three pieces of kitchen equipment here that we do all the cooking,” explained Daniel Shlossman, Wonder’s chief growth and marketing officer. “You have the all-electric oven, all-electric water bath and all-electric fryer right here. And that’s it. That’s what is able to produce 25 restaurants open now out of 3,000 square feet in a single location.”
So, this isn’t one restaurant, it’s dozens. They’re all owned by Wonder and all operate out of this not-very-big kitchen. There are 13 others like it. Other locations prepare food for up to 30 restaurants.
In some cases, Wonder has bought the rights to existing restaurants around the country — Tejas barbecue in Tomball, Texas; Fred’s Meat & Bread in Atlanta. But most of its restaurants do not exist as stand-alone brick-and-mortar places. They’re just in the Wonder app, or sometimes on third-party platforms like DoorDash.
“If we open up one of the fridges here, you can see there’s various menu items from across an assortment of restaurants,” Shlossman said. “And it’s really all kind of preportioned ingredients that may have been parcooked, and our team members put them together to order when someone places an order.”
A central kitchen in New Jersey partially prepares ingredients for meals based on various restaurant concepts and ships them daily for final cooking here or at any of Wonder’s locations in the Northeast. The company says it expects to have 35 locations by the end of the year and 90 by the end of 2025. This arrangement means they can make the food of 30 restaurants with a fraction of the overhead and labor costs.
“We own the concepts, and that’s what gives us the ability to vertically integrate in the way that we do,” said CEO Marc Lore. “We own the delivery network, and we set a tight radius of six-minute delivery, 10 minutes in the suburbs.”
Customers can get food from multiple restaurants in one order, and software prompts employees to start preparing each at a different time so they come out hot in unison. The goal is a 30-minute turnaround between the food being ordered and delivered.
Wonder has a research and development center in Parsippany, New Jersey, “where we’ve got many teams of chefs working on different restaurants figuring out ways to cook faster and higher quality,” Lore said. If a new restaurant type is gaining popularity, Wonder can develop and introduce its own version within months.
“We can drop it overnight without any capex investment” and roll it out to multiple locations, Lore said. Wonder is adding Korean cuisine and a kid’s restaurant, he said. “And we’re also getting feedback on meals every day.”
Wonder recently completed $700 million in funding.
“In a lot of ways, it’s the cutting edge of thinking of the industry,” said Gregg Thomas, co-leader of the restaurant practice at business advisory firm BDO. Elevated ingredient and labor costs have the restaurant industry in a vice right now, and “one way to defeat the wage increases, which have been significant in the back of the house, is to centralize the kitchen,” Thomas said.
In some cases, this means one restaurant group using a commissary, or central kitchen. “Most restaurant groups of any size, with maybe over 10, 15, 20 stores, all for the most part in the same metro area — every single one of them is talking about commissary as a way to defeat production costs,” Thomas said.
Sally Lyons Wyatt, global executive vice president and chief adviser for consumer goods and food service at market research company Circana, said the efficiency in that scenario is significant.
“You serve consumers with shared ingredients, shared staff, shared kitchen, shared delivery,” Lyons Wyatt said.
But the coordination can be tricky. Lore said sharing space is not necessarily enough. Multiple restaurant brands in a single kitchen may need “different equipment for each one of their brands. Each brand has its own standards and procedures, and so all you’re doing is taking what should have been in a normal-size kitchen and you’re forcing it into a kitchen a third of the size,” Lore said.
That can create unnecessary complexity, waste and inefficiencies — even more so if a central kitchen is owned by a third party. Making it work requires vertical integration, culinary and software engineering, and a carefully designed platform, he said.
Efficiency has become crucial, Lyons Wyatt emphasized. “This year specifically, in 2024, we’ve seen traffic decline for restaurants,” she said. “The macroeconomic conditions are such that it’s a stretch for as many people that used to go out to go out to eat anymore because it’s so expensive.”
Sit-down traffic, which constitutes 22% of commercial food service, is down by 2% this year, Lyons Wyatt said. Carryout, which accounts for 43% of commercial food service, is down by 1%. Drive-thru represents about 28% of commercial food service, and that’s down 5%.
The only exception to the trend is delivery. It’s up 6%. Delivery accounts for most of Wonder’s business.
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