Cover Photo: A Golden Door Knocker in Malaysia| Tricia A. Mitchell
The airplane slowly began to rumble down the runway. As its speed increased, seats, traytables, and belt buckles began to rattle around me.
Never a big fan of flying, I took a deep breath and tried to take comfort in the glimmering newness of the Air Asia cabin; the seats seemed new, the wall panels were spotless, and the overhead cabin was well-lit.
As the plane began to angle upward, I kept my eyes focused on the shiny white ceiling.
Suddenly, what appeared to be white smoke suddenly began pouring out from behind the luggage racks.
“Oh!” I blurted out through a clenched jaw. “What is that!”
I inhaled deeply and tried to keep a clear head. After a couple of deep breaths, I noticed that I wasn’t smelling any smoke. It appeared to be a misting device, probably designed to give passengers the feeling that they are breathing fresh and clean air.
As my nerves gradually returned, I began to relax and enjoy the comfort of Air Asia’s two-hour flight to Singapore from Bangkok.
However, what I was really impressed with was the food.
It seems I’m not alone. A recent article in Skift suggests that Air Asia is opening a terrestrial fast food restaurant called Santan, or “coconut milk” in Malay. Soon your single serving meals in the skies over Southeast Asia will be available in a neighborhood near you.
Air Asia’s idea may not be as strange as it sounds. The company’s use of centralized food production facilities to expand beyond compartmentalized airline meals is part of a larger trend away from people cooking at home.
Outsourcing the Kitchen
Cooking food in your kitchen at home consumes a lot of resources. Factor in the amount of time it takes to go grocery shopping, to prepare the food, cook, and do the dishes, and eating at home begins to take a big chunk out of your day.
Food storage and preparation at home also consume energy, leading to 30-40% of all store-bought food being wasted.
The world (and venture capital) is beginning to take notice. India’s startup food delivery service, Swiggy, recently raised $1B during a funding round in December.
This follows the growth of other food delivery startups like FoodPanda, UberEats, and Zomato — all of which are dependent upon a rapid scaling up of their business to achieve “economies of scale.”
Economies of Scale
In economics, there is a theory that the more a company produces of an item, the cost to produce each item decreases.
This theory is known as “economies of scale” and is tied to your total fixed costs being divided by an ever larger number of items being produced.
For example, in home economics, whether you are cooking for just yourself or for 20 people, you still need to shop, prepare, cook, and clean up. While cooking for 20 people will take longer, the cost per plate is significantly lower when performed in bulk.
Economies of scale is what is driving the current entrepreneurship boom in food delivery.
If a person at home is making $25 an hour and can save two hours a day of shopping, preparing, cooking, and cleaning up, then to get all three meals a day delivered to you under $50 is worth it.
The Automation Revolution
Robotics is about to further centralize food production and outsource the kitchen. From robotic chefs like Flippy, to self-driving cars that deploy an army of food delivery robots, robotics is poised to further lower per unit food costs.
For Air Asia’s new fast food chain based on airplane meals, this could be good news — their compact spicy coconut dishes will be easier to deliver via robots.
However, I suspect that I will want to visit their restaurants over receiving their takeout — especially if they have misting devices spraying down from the ceiling.