Uber Eats inks pact with CCD to launch virtual restaurant network

Getting into a new business, in an India-first move, Uber Eats has tied up with Café Coffee Day (CCD), to launch the country’s largest network of virtual restaurants. It will start ‘delivery-only’ restaurants exclusively on the Uber Eats app, for which both the companies will come up with various brands. The first restaurant brand is scheduled to launch in November. The two would launch more such brands depending on cuisines and themes.

While the food would be cooked at CCD kitchens, Uber Eats would provide the technology, backend and delivery logistics. 

Uber Eats would start with a pilot in Bengaluru. CCD’s network of almost 1,750 outlets in 246 cities would help it expand its national footprint and this new business by next year. 

According to sources close to the company, Uber Eats plans to expand this side of the business, and might get into more such tie-ups with restaurant chains. 

CCD and Uber Eats would launch an app-and-delivery-only menu, which otherwise will not be available at the CCD outlets.

According to Jason Droege, vice-president, Uber Everything, Uber Technologies said, this is an India-first initiative. Depending on its success, the company plans to take this to other markets where it is eyeing rapid expansion such as Latin America.

“Using experience, and lessons learnt in the virtual restaurant space from our global operations, we hope to provide our Indian restaurant partners greater growth opportunities. Virtual kitchens utilise and maximise the usage of already-available infrastructure, and keep the costs under control,” Droege said.  

According to executives at Uber Eats, having restaurant chains provide the infrastructure reduces the costs ‘cloud kitchens’ have. 

“Under the cloud kitchens model, an aggregator of restaurants provides space to quick-service chains. These chains prepare the food and the food delivery firm drops it door to door. It involves a lot of costs. Here, we are using what is already available. So there are almost no establishment costs,” said an executive. 

UberEats is present in 37 cities in India, with a strong presence in tier-II cities. In the last 3 months, the number of orders on the app has grown six times, and the app is adding 100 new restaurants everyday.  

“A virtual brand is being created as we speak,” said Venu Madhavan, CEO, CCD. “For example, there might be region-specific brands based on cuisines such as Gujarati food; a brand which covers the food culture in all of northeast. Also, there will be specific brands to cater to the office lunch and snacks crowd. But, the reveal will only happen next month,” said a source at UberEats.

Competition is heating up in this space, which recently saw Ola-owned Foodpanda acquire Holachef. Tech giant Google has also launched its restaurant delivery and home-services platform, Areo in India.