Zepto, a prominent player in India’s quick commerce sector, has temporarily suspended its Zepto Cafe services in 44 locations across North India. This decision affects cities such as Delhi, Agra, Chandigarh, Mohali, Amritsar, and Meerut, and is primarily attributed to supply chain constraints and staffing challenges.
Reasons Behind the Suspension
The surge in demand for Zepto Cafe’s 10-minute food delivery service outpaced the company’s supply capabilities. Vendors faced difficulties in meeting the unexpected volume, leading to frequent stock shortages. Additionally, some staff members did not report to work, exacerbating operational challenges.
Impact on Workforce
The suspension has affected over 700 gig workers associated with the 44 impacted cafes. Zepto has offered these workers options to transition into roles within its dark stores or other operational cafes.
Financial Considerations
Zepto’s monthly employee costs have been substantial, reportedly nearing ₹100 crore, which is about 80% of what larger rivals like Zomato and Swiggy spend. This high expenditure, coupled with supply chain issues, has prompted the company to reassess its operations.
Future PlansWikipedia
Zepto aims to resume Zepto Cafe services in the affected locations by the end of the next quarter. The company is working on stabilizing its supply chain and optimizing operations to meet the high demand effectively. TechStory
