Introduction
The recent suspension of Zepto’s operating license in Dharavi, Mumbai, following a surprise inspection by the Maharashtra Food and Drug Administration (FDA), has stirred a significant amount of concern regarding food safety in the quick-commerce sector. This incident highlights not only the serious hygiene violations at Zepto’s facility but also broader implications for the fast-evolving online grocery industry in India.
Key Findings from the FDA Inspection
During its inspection, the FDA uncovered numerous alarming issues within the Dharavi warehouse operated by Zepto’s parent company, Kiranakart Technologies Pvt. Ltd. The findings included:
- Fungal growth detected on stored food items.
- Expired products found stored with non-expired inventory.
- Cold storage failing to maintain required temperatures.
- Unsanitary conditions including wet floors and poor drainage.
- Food materials stored near stagnant water.
The inspection was prompted by a tip-off to FDA Minister of State Yogesh Kadam. The photographic evidence collected during the inspection depicted disturbing hygiene violations, including visibly spoiled food and improperly maintained storage conditions.
Zepto Responds
In the wake of the inspection, Zepto has announced that it is conducting an internal review and is cooperating with the relevant authorities. As a proactive measure, the company has temporarily suspended operations at its Dharavi warehouse and halted Zepto Cafe services in regions like Delhi and Chandigarh.
In a statement addressing the public, a Zepto spokesperson expressed:
“We are taking this matter seriously and are working to rectify any gaps in protocol. We remain committed to food safety and compliance with all government regulations.”
Regulatory Action and Consumer Concerns
With the license suspension in place, the FDA has not specified when or if it will be reinstated. Officials revealed that Zepto’s facility will remain under suspension until all violations have been comprehensively addressed and it successfully passes re-inspection.
This situation has raised serious alarms about hygiene standards across India’s rapidly growing quick-commerce sector, which comprises notable players such as Blinkit, Swiggy Instamart, and Dunzo. Experts in health and food safety are advocating for stricter oversight of dark stores and fulfillment centers managed by these platforms to ensure compliance with fundamental safety standards.
Impact on Zepto’s Business
The license suspension directly impacts one of Zepto’s key distribution hubs in Mumbai, a crucial market for the startup. In response, deliveries from that warehouse have been rerouted to alternative facilities. However, the ongoing controversy surrounding food safety could significantly damage Zepto’s reputation as a trustworthy provider of groceries and ready-to-eat products.
Founded in 2021, Zepto has raised a staggering amount of over $1.3 billion in funding and was last valued at approximately $5 billion after a $350 million investment round in November 2024. The company now operates over 250 dark stores across India, catering to millions of customers with an impressive median delivery time of under nine minutes.
Industry Watch
This incident marks the most significant regulatory action against Zepto since its establishment. It has sparked speculation that food safety inspections might see an uptick across major metropolitan areas’ quick-commerce operations. The ongoing situation is prompting consumer rights groups to push the Food Safety and Standards Authority of India (FSSAI) for stricter compliance norms, advocating for more frequent inspections to enhance public safety.
Conclusion
As the quick-commerce sector continues to expand in India, the incident involving Zepto serves as a crucial reminder of the importance of stringent food safety practices. The implications of this case go beyond one company, demanding attention to hygiene standards as a means to foster consumer confidence in online grocery shopping. The ensuing actions from both Zepto and regulatory authorities could set a precedent for how food safety is managed in this fast-paced industry moving forward.
