(Image: CHS)

As she and her husband opened Hot Dogs Perrones in a Capitol Hill ghost kitchen, Lena Escoto Arriaga knew they wouldn’t stay hidden for long. While the first month of business has been successful, Escoto Arriaga plans to set money aside for a brick-and-mortar location of their own.

Escoto Arriaga is a Seattle native with Puerto Rican roots. For her fulltime job, she designs footwear for toddlers, and in the evenings, she assists her husband Emer with marketing and operations for Hot Dogs Perrones. Emer is originally from Honduras, and has an extensive background in the restaurant industry. He became burnt out from making someone else’s restaurant dreams come true, which led him to starting his own food and drink venture — in someone else’s kitchen.

El Perro de Seattle (Image: Hot Dog Perrones)

“Our decision to do Cloud Kitchens was only based on costs,” Escoto Arriaga said.

Cap Hill Kitchens, where Hot Dogs Perrones is located on 14th Ave, is a concept from Cloud Kitchens, ex-Uber CEO Travis Kalanick’s company behind a nationwide network of new-era commercial kitchen facilities. The concept of a “cloud kitchen,” or “ghost kitchen” is to operate a business from low-rent or noncommercial spaces that prepare food ordered online for delivery.

CHS reported here in October on the opening of the Cap Hill Kitchens facility next to The Cuff. The launch roster on Capitol Hill included a mix of restaurants including some with a history in the city like Pam’s Kitchen and some like the ownership of TJ’s Street Tacos which has already doing business at existing food truck and commercial kitchen spaces. Others are brand new like Hot Dogs Perrones.

The benefits of starting in a space like Cap Hill Kitchen are very much about the bottom line. “We offer kitchens for modern-day chefs and help get you set up with specialized commercial kitchen equipment and minimal fuss,” the Cloud Kitchens pitch reads for its package license that includes a space in the facility and the company’s “Otter” management software. The company says the ballpark upfront license cost is around $30,000 plus owners save on rent having to only pay for a small 200 to 300 square foot portion of the building. It also promises restaurants the opportunity to run a business that would require more than 20 employees with less than five and claims a new concept can go from planning to opening in about 6 weeks. The big promise? A “breakeven” point in about 6 months — “based on 10% profit and $1M in annual sales” and, importantly, with variation based on “local permitting and operational complexity.”

Escoto Arriaga said their experience with Cloud Kitchens has not been the smoothest.

“Cloud Kitchens promise lots of things, then after you’ve signed…it’s not a great experience with them, and many [ghost kitchens] aren’t having a great time, but I try to leave that bias behind,” Escoto Arriaga said.

(Image: CHS)

(Image: CHS)

(Image: CHS)

(Image: Hot Dog Perrones)

She acknowledged how the permitting process through Cloud Kitchens was smooth, due to an already established network. Cloud Kitchens was also helpful with providing a starter plan, and establishing relationships between Hot Dogs Perrones and food delivery service apps. At the same time, she said there continue to be issues with timely responses.

“One time, I bought the wrong sized table and I had to return it, and there was a restock fee,” Escoto Arriaga said, noting how she lost money on that purchase due to a delayed response from Cloud Kitchens, with responses sometimes taking up to one week.

While ghost kitchen start-up costs can be a quarter of what it costs to open a brick-and-mortar, Escoto Arriaga said high transaction fees can also eat into profits.

“If we put something on the menu, they [UberEats] take 25%, and then Cloud Kitchen taxes on 3% if runners are onsite running orders, and we can’t opt out,” Escoto Arriaga said.

The runners are employed by Cloud Kitchens and run delivery orders out to smart-lock cubbies, where clients or delivery drivers can then pick-up the food. She said they receive the 3 percent tax, even though her and Emer are the ones who usually bring the orders to the cubbies.

When going out to eat, Escoto Arriaga said she looks for personable experiences, and she’s figuring out how to provide that experience as Hot Dog Perrones gets started without the face-to-face interaction of the ghost kitchen. In between her jobs and her time spent as a mother to two toddlers, she is looking to develop social media platforms to create a sense of community and to provide a look behind the business.

Escoto Arriaga said Capitol Hill is much more diverse these days, and she’s seen an increase in American and Latino fusion foods and wants to hit that niche market. Hot Dogs Perrones offers a mixture of Latino-inspired foods including a Latin Kraken hotdog. The Julio bacon wrapped hot dog seems to be a fan favorite: it’s a 100% beef hot dog wrapped in bacon, with grilled bell peppers, grilled onions, and jalapenos.

“Capitol Hill is saturated with Seattle dogs, but our menu is designed to be a fusion of Latin Culture mixed with American culture,” Escoto Arriaga said.

Escoto Arriaga said they also added a cheesesteak hot dog option. This coming month, Hot Dogs Perrones will add the Picadillo hot dog, which will be a ground beef hotdog with vegetables, potatoes, and a seasoned sauce. Other goodies include flaming hot Cheeto wings.

Going forward, Escoto Arriaga said they hope to pay off what they owe in initial startup costs, and move out of Cap Hill Kitchens. She said moving out is the pathway Cloud Kitchens actually promotes — the company says its ghost kitchen owners generally move out after one year.

The couple doesn’t just want to move out of Cap Hill Kitchens. They want to move on with hopes you can walk into a Hot Dog Perrones someday soon.

“We want to make enough income this year to have some set aside for a brick-and-mortar,” Escoto Arriaga said. “We want people to come and hangout, and eat a hotdog and have a full experience.”

Hot Dogs Perrones is located at 1525 13th Ave inside Cap Hill Kitchens in suite K144. You can learn more and order for delivery — or pickup — at hotdogsperrones.com.

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