Zepto Cafe Halts Operations In Multiple Cities

Quick delivery major Zepto’s quick food delivery arm Zepto Cafe has temporarily shut operations in multiple small cities, mostly in north India, like Agra, Chandigarh, Meerut, Mohali and Amritsar. 

According to an ET Now report, about 44 cafes have paused operations, impacting over 400 employees. 

Zepto confirmed the development in a statement shared with the TV channel. The startup said that operations at some cafes have been put on hold to address supply chain challenges. It expects to resume operations in these locations by the end of the next quarter. 

“We remain committed to the cafe business and will invest aggressively going forward,” a company spokesperson was quoted as saying.

Besides, the report also said that Zepto has decided to cut the workforce at many of its cafes. While a Zepto Cafe store has 9 staff on an average, the startup plans to bring this down to 7-8 for many cafes. 

This comes at a time when Zepto’s employee costs are on the rise. As per a report by Moneycontrol, Zepto’s employee salaries cost stood at INR 95 Cr in April. While this was lower than the previous months, its wage bill was 80% of what food delivery majors Zomato and Swiggy spend, despite Zepto having about half of their headcount.

As per the report, Zepto spent as much as INR 115 Cr to 120 Cr on employee salaries in March and INR 105 Cr to INR 110 Cr in January and February.

Interestingly, Eternal chief Deepinder Goyal said in March that Zepto was burning around INR 2,500 Cr per quarter. However, Zepto founder and CEO Adit Palicha said this was not true.

Meanwhile, in another trouble for Zepto, its delivery executives in Hyderabad are on an indefinite strike, which entered the fifth day today. The executives are protesting against Zepto’s decision to slash delivery fees.

Telangana Gig and Platform Workers’ Union (TGPWU) president Shaik Salauddin told Inc42 that Zepto decreased its per delivery fee from INR 35 per order in April this year to INR 10 to INR 12 per order in May. “The managers in Hyderabad have told us that Zepto won’t be increasing the fees,” he added. 

The TGPWU has submitted a formal complaint to additional labour commissioner E. Gangadhar, urging government intervention in the matter of “ongoing labour rights violations” by Zepto.

Workers across several dark stores in Hyderabad are protesting against the startup. They have alleged that Zepto has ignored repeated calls for dialogue.

All of these come at a time when Zepto, like many other startups, is also gearing up for its public listing. The startup is said to be eyeing its stock market debut in early-2026. 

On the financial front, Zepto’s net loss declined 2% to INR 1,248.64 Cr in FY24 from INR 1,271.84 Cr in FY23. Operating revenue grew 120% to INR 4,454 Cr during the year under review from INR 2,025.70 Cr in FY23.