Quick delivery platform Zepto has temporarily shut 44 of its 10-minute food delivery cafes in some cities in North India including Delhi, Agra, Chandigarh, Mohali, Amritsar, and Meerut due to supply chain issues, according to sources.
Most of these Zepto Cafes became operational in the past couple of months.
“The demand in these cafes was much higher than anticipated, leading to vendors facing difficulties in supplying many products,” one of the sources said, adding many items were “out-of-stock in these locations most of the time”.
Zepto Cafe procures most of its 200 products from different vendors in different cities.
“They have closed these stores to sort the issue and work with vendors to increase the capacity,” another person said, adding that all of these stores are likely to become operational again by August or September.
Each Zepto Cafe has around 9-10 workers. Around 500 gig workers are likely to be impacted by the current pause. The company has offered them to either work in the same dark store as pickers/packers or at the nearest operational cafe, the first source said.
Zepto did not reply to FE’s queries till press time.
The company has a separate area in its dark stores called mini-kitchen for Zepto Cafe. Out of its total around 900 operational stores, these kitchens are present in 750. A majority of these, around 500, are located in North India alone.
This comes at a time when Zepto Cafe has been witnessing a high surge in daily orders. In February, the vertical crossed 100,000 orders per day. Analysts suggest this number may already have crossed 200,000 in May.
The quick food delivery space has been witnessing growing competition. Eternal-owned Blinkit runs a similar service Bistro, which now has over 100 kitchens across Delhi-NCR, Mumbai, and Bengaluru.
Swiggy is also expanding its in-house rapid food delivery vertical, Snacc. Moreover, it is also pushing the pedal on its another 10-minute food delivery platform Bolt. Currently, Bolt is active in around 500 cities with partnership with major QSR companies like Dominos and McDonalds.