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Zomato cracks down on Cloud kitchens operating hundreds of brands from one location
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IANS | 23 Sep, 2022
Online food aggregator Zomato on Friday announced to crack down on Cloud
kitchen operators who are misusing legal loopholes to offer hundreds of
food brands from a single, small kitchen.
The company
said that it is going to manually check any physical location which runs
more than 10 brands out of a single location.
"While there is no
exact science to the right number of brands, we believe that even the
most organised outlets in the industry don't see operational benefits
and customer trust in operating too many brands from a single kitchen,"
said Zomato.
The food delivery platform engaged with the National
Restaurant Association of India (NRAI) and other restaurant partners to
formulate the right approach to curb these practices.
"Upon
deliberations with Zomato, we felt this was an acceptable interim
solution wherein the Zomato team carries out a preliminary physical
inspection of such locations," said Kabir Suri, President NRAI and
Co-Founder of Azure Hospitality.
"We will further work with the
Zomato team in ascertaining whether these kitchens comply with
acceptable industry norms and suggest solutions thereon," he added.
The
Food Safety and Standards Authority of India (FSSAI) has stated that
cloud kitchen entities are free to operate multiple brands on a single
FSSAI license (usually unique to a kitchen).
However, there are
some exceptions to this. Some fly-by-night operators, who account for
less than 0.2 per cent of registered kitchens, misuse this flexibility
in law by creating innumerable brands from the same kitchen.
"These
brands have little to no differentiation in the product offering;
instead they confuse/cheat customers by creating a false perception of
choice, while none of it actually exists," said Zomato.
"Most of
the brands run by these operators also have terrible reviews and ratings
on our platform. Such operators tarnish the reputation of the
restaurant industry as a whole, hurting all of us in more ways than
one," said the company.
The customers' average delivery rating for these operators goes down as the number of brands from a single kitchen goes up.
Similarly, the percentage of customers who raise complaints goes up as the number of brands from a kitchen increases.
Zomato
said it will whitelist the restaurant partners that provide a great
experience so that they don't face delays while expanding the scope of
their businesses.
"We will also showcase the information of
multiple brands linked to a kitchen on the restaurant's page on Zomato,
in the spirit of transparency.," it added.
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