Dive Brief:

• Kroger has partnered with Kitchen United to offer shoppers freshly prepared, on-demand restaurant food, according to a press release. These off-premise kitchens inside participating Kroger locations will offer up to six local, regional or national restaurant brands. 
• The first kitchen center is set to debut this fall at a Ralphs store in Los Angeles, with additional locations expected to open later in the year. 
• This collaboration comes after Walmart's partnership with Ghost Kitchen Brands to bring multiple restaurant brands to stores in the U.S. and Canada through onsite ghost kitchens. 

Dive Insight:

Both Kroger and Walmart have pursued ghost kitchens for years as a means to expand onsite dining and takeout options for time-strapped guests. Grocers have been expanding onsite eating options in a bid to entice shoppers to stay in stores longer and hopefully spend more — both a threat to restaurants' share of stomach and an opportunity for restaurants to enter nontraditional channels. 

Kroger first explored the channel in 2019 through a partnership with ClusterTruck, a company that owns and operates vertically integrated, delivery-only kitchens, and created a new service called Kroger Delivery Kitchen. While these meals are prepared at ClusterTruck's dark kitchens, Kroger did open two onsite locations in metro Columbus, Ohio, and Indianapolis in 2020. 

Kroger's partnership with Kitchen United will be much different, however. Instead of offering Kroger-branded food that's prepared by ClusterTruck, the Kitchen United locations will provide access to a variety of outside restaurant brands. Customers will place orders through Kitchen United's website, app or via ordering kiosks. They can also create a customized order from the multiple brands available with one receipt. Restaurant staff then prepare the orders and delivery fees are determined by third-party providers. 

"As we continue to define Kroger as a food destination, this collaboration creates another seamless way for our customers to order lunch or dinner for pick up while they shop for groceries or for delivery to their location of choice," Craig Gauden, Kroger's director of partnership development, said in a statement.

This isn't the first time Kroger has brought restaurant brands inside its stores, either. The grocer has been opening Saladworks units throughout its system in recent years. It also added its own restaurant brand, Kitchen 1883, to a Union, Kentucky, location in 2017, and this restaurant appears to only be available now at two Kroger locations.

But Walmart is still a formidable ghost kitchen competitor. Following its pilot with Ghost Kitchen Brands, the big box store now offers restaurant meals from brands such as Saladworks, Nathan's Famous and Wow Bao at a number of stores throughout the country. 

Kitchen United has also been growing this year, with plans to open 16 Kitchen United Mix locations by the end of 2021. Earlier this year, it entered into a licensing partnership with U.K.-based restaurant Camile Thai to bring the brand to the U.S. for the first time. Kitchen United has also been expanding into malls through a partnership with Westfield, opening a center in Westfield Valley Fair mall in Santa Clara, California, in February.