Zomato, the food delivery and dining company, has announced on Friday that it will conduct a physical inspection of cloud kitchens which run more than ten companies out of a single location in a bid to avoid operator mistreatment.
"While there is no exact science to the right number of brands, we believe that even the most organised outlets in the industry do not see operational advantages and customer trust in being able to operate too many brands from a single kitchen," Zomato said in a blog post.
The food aggregator said that in the past, the Food Safety and Standards Authority of India (FSSAI) has also stated that cloud kitchen organizations are permitted to operate multiple brands on a single FSSAI license.
It claimed that some fly-by-night operators, who account for less than 0.2 percent of registered kitchens, use this flexibility in law by acquiring innumerable brands from the same kitchen.
According to Zomato, these businesses have little to no differentiation in the product offering; instead, they confuse/cheat customers by creating a false perception of choice, while none of them exists.
"Some of these operators have extensive reviews and ratings on our platform. Such operators erode the reputation of the restaurant industry as a whole, causing us to be harmed in more ways than one," said the author in a statement.
Besides resolving why this is leading to a bad customer experience, a blog post claims that these operators often create multiple brands with very little differentiation in the actual product (dishes or the food experience itself) offered to customers.
Consequently, managing multiple brands and cuisines is both operational and complex, and, unless done with the correct SOP and oversight, this resulted in serious inconsistencies in food quality and hygiene, according to the food aggregator.
Zomato has said that it has been working with the National Restaurant Association of India (NRAI) and other restaurant partners in the last few weeks to develop a suitable strategy to combat these practices.
"Upon deliberations with Zomato, we believed this was an acceptable interim solution wherein the Zomato team performs a physical inspection of such locations.
"We will continue to work with the Zomato team to make certain that these kitchens meet industry standards and propose solutions thereon. The aim of this company is to build and maintain a healthy environment," said Kabir Suri, the president of the National Natural Resources Administration.
"Going forward, we will manually verify any physical location which has more than ten brands out of a single location," Zomato said.
The aggregator said it will list restaurant partners who provide a great experience other than the operators mentioned above from this manual examination so that they do not be subjected to delays while expanding their scope.
It suggested that restaurant partners who do not make it to the whitelist and believe they serve very differentiated brands (more than 10) from the same premises to get in touch with the company.
"Our staff will investigate your proposed offering, whether it be large enough to host and do justice to multiple dishes," a historical customer experience on Zomato, among others. We will also collaborate with FSSAI at their request so it helps our authorities," wrote a blogpost.
Zomato''s decision comes after a Twitter thread a few weeks back on multiple kitchens being run by the same people.