The United States may showcase leniency on these ghost kitchens, but not China.
According to a report on Nikkei Asia, China has started its crackdown on food delivery “ghost kitchens.”
The Chinese government is slated to tighten a clampdown on food delivery companies in June, conducting unannounced or impromptu inspections to weed out restaurants that claim fake locations, and are not physically-present, or those operating without a license.
It is tightening control over Chinese ghost kitchens that are found there on food delivery apps, but do not have brick-and-mortar locations.
Authorities are requiring apps to verify the licenses of these restaurants and their physical addresses starting this week.
Should merchants wish to remain on the app and not be cracked down, they must ensure that their listings are available, as well as matching their actual premises, and indicate whether they offer dine-in services.
This comes after authorities found that these ghost kitchens on food delivery apps channel the customer orders to third-party operators, subsequently allowing merchants to reduce prices to gain more customers.
They detected not merely hundreds, but thousands of these ghost kitchens across the East Asian country, and what’s worse, they are triggering food safety concerns.
This certain crackdown stemmed from a tiny complaint in Beijing last year over a cake from a ghost kitchen with flower decorations that are supposed to be edible, but are not.
Looking across, officials found that the cake brand actually listed almost 400 outlets on huge platforms, but the restaurant has no physical store and is using fake business licenses and permits.
The investigators found that the orders from there were routed through an order-transfer platform, then outsourced to vendors offering the lowest bids.
Then, they found there were 67,000 more ghost shops across seven delivery apps, forming this “illegal supply chain through mutual collusion.”
Ghost kitchens are restaurants that are not only those that are present in apps, but got no physical location, but also those that outsource orders to third-party vendors. They fulfill them at lower costs, allowing merchants to really lower down prices and maximize profits.
There are thousands of these ghost kitchens across China, raising lots of concerns that the low prices are also coming at the cost of food safety. Care to share your insights? Sign up for your account today here on Ridesharing Forum!