Independent restaurant owners are accusing global corporations of engaging in “sneaky” practices that are “a killer” to family-run businesses by disguising themselves as independent eateries on delivery applications.
Several chain restaurants, including Pizza Hut, TGI Fridays, Frankie & Benny’s, Las Iguanas, and Barburrito, are reportedly operating under different brand names on platforms like Deliveroo and Just Eat, creating the illusion of being smaller, independent establishments.
Justina John, proprietor of ONJA Taste of Tanzania in Cardiff, describes the struggle to survive as “like small fish trying to swim with the sharks.”
Peter Backman, CEO of theDelivery.World, suggests that this practice is only deceptive if customers are intentionally seeking to support independent restaurants and takeaways.
Justina, 45, who opened her restaurant in Cardiff approximately a year ago, has observed an “overwhelming presence of chain restaurants, sometimes masquerading as independents” on delivery apps.
“Very sneaky, it’s not fair on the small businesses,” she stated.
“The only thing that’s keeping us alive is authenticity; there are certain things you can’t fake.”
Justina is advocating for delivery platforms to assume greater responsibility by verifying listings and assisting genuine independent businesses through separate categorization on the apps, enabling customers to easily support them if they choose.
Just Eat, Deliveroo, and Uber Eats have all indicated that virtual brands can be utilized by any business, including independent ones.
Just Eat affirmed its support for independent businesses in reaching new customers, adding that virtual brands provide partners with “the opportunity to expand their food offerings and diversify their revenue streams.”
The company stated its commitment to transparency, noting that customers can view the address from which they are ordering “to help them make informed choices.”
Deliveroo stated that its “core mission is to champion local businesses” and that virtual brands allow restaurants to “leverage existing kitchen facilities and capacity to create a delivery-only brand, giving them the opportunity to reach new customers and drive additional revenue in an increasingly digital world.”
Uber Eats asserted its commitment to “levelling the playing field” for merchants on its platform, adding: “We have a growing team of dedicated account managers working to build bespoke solutions and equal exposure opportunities on the app, and we accelerate rather than compete with our partners’ sales.”
Jamie Rees, 36, co-owner of Fowl and Fury in Cardiff, mentioned that he initially noticed chains creating digital brands three years ago, but now it is “literally everywhere.”
He identified Frankie & Benny’s as “the worst offender, recently,” with TGI Fridays being “quite a big one.”
While in Cardiff, the BBC accessed Deliveroo and checked some of these takeaways by selecting the “allergens and info” option, which provides the registered address of the company supplying the food.
The results indicated that Bird Box and Stacks originated from Frankie & Benny’s, Mother Clucker from TGI Fridays, Wing Street from Pizza Hut, Hot Chick from Coyote Ugly, and Badass Burritos from Barburrito.
Jamie understands the rationale behind the practice and acknowledges its inevitability, but he expressed frustration because apps, in theory, create a more equitable environment.
“But then when they bring out five different restaurants under the same roof, now I’m not equal,” he added.
“They have more money for advertising, promos, photographers.”
He is advocating for legislation regarding transparency about the kitchen of origin and the parent company behind the food.
“What I fear is eventually the smaller guys are going to go out of business because they’re a lot less visible on these platforms.”
“It feels a little bit unethical, because nine times out of 10 the people that are ordering from these ghost kitchens are doing it because of the branding.”
For Fowl and Fury, this presents a significant challenge because most consumers place orders online.
While friends have suggested creating an independent-only delivery service, he acknowledges its inability to compete with Uber Eats, Just Eat, and Deliveroo.
Rajendra Vikram Kupperi, 45, director of Vivo Amigo, which opened in Cardiff in 2020, believes that ghost kitchens are diluting the takeaway industry and are unfair to independent businesses.
“During Covid, the number of ghost kitchens that opened was endless. It’s a killer,” he said.
“The bigger brands can undercut the prices, they can have good offers.”
Vivo Amigo uses Deliveroo, Uber Eats, and Just Eat, but Rajendra feels that his business has been directly impacted by the use of ghost kitchens.
Mexican food brands often have online sub-brands. For instance, Kick-Ass Burrito is associated with Las Iguanas, and Barburrito operates on Deliveroo under its own name, as well as Death Valley Burrito, Badass Burritos, and Twisted Health Kitchen.
He expressed a desire for ghost kitchens and major brands to be separated from independent restaurants to prevent consumer deception.
“That would encourage customers who want to support independent brands, but at the moment it’s all mixed up,” he said.
“Customers can’t really differentiate.”
Barburrito stated that virtual brands are “one way restaurants can make better use of existing kitchens, reduce waste and respond to customer demand.”
In a statement, the company clarified that the model “is not exclusive to large chains, and many independent operators are equally able to create virtual brands on delivery platforms.”
Coyote Ugly commented: “The problem isn’t competition, but whether businesses can remain viable at all.”
“Ultimately, this is about keeping doors open, protecting jobs and giving hospitality a fighting chance to thrive.”
Peter Backman of theDelivery.World explained that large chain restaurants create ghost restaurants “for extra revenue; they’ve got the capacity – why not?”
He expressed uncertainty about whether customers are concerned about this practice, but he acknowledged that it is “deceiving” if they “really believe they’re supporting their local business.”
“But if the consumer is just saying, ‘oh, I want some wings’, what the hell does it matter?”
He voiced his support for transparency and suggested that delivery apps having a dedicated page for independent businesses would be a positive step, but he questioned the practicality of such a measure.
Frankie & Benny’s, TGI Fridays, Pizza Hut, and Las Iguanas have been asked for comment.
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