Cloud kitchens in crisis as discounts go away


Commercial gas cylinders are now expensive as discounts have been removed

Cloud kitchens that were using discounted commercial gas cylinders can no longer afford them and have had to shift to domestic gas cylinders for their business.

Sangeeth, who owns a cloud kitchen in Chennai said, “Commercial gas cylinders were expensive even after discount in comparison to domestic gas cylinders. Now after the removal of the discount it almost became unaffordable  as we need two to three cylinders per month.” She added that now she can hardly afford them and has to rely on domestic cylinders for cooking, though it is illegal to use them.

Indian oil marketing companies like Hindustan Petroleum Corporation Limited(HPCL), Bharat Petroleum Corporation Limited (BPCL), and Indian Oil revoked the discount on commercial gas cylinders by citing that in some market places commercial gas cylinders are cheaper than domestic gas cylinders.

However, experts say that it is impossible that commercial gas cylinders are cheaper than domestic gas cylinders. They said that oil companies did away with the discount because it increased their costs.

Nilu, who runs a small-scale cloud kitchen in Bengaluru said, “We subscribed to commercial gas cylinders because they give free stoves as well. Other than that they are of no use. A cylinder costs around Rs 2100 and lasts only two days more than a domestic gas cylinder.” She said now that the discount has gone; she was not sure how much it would cost. So, she chose to use domestic gas cylinders.”

A.Ganesh Kumar, professor of Economics at Indira Gandhi Institute of Development and Research, Mumbai said, “Removal of discount on commercial gas cylinders will impact cloud kitchens as they already find it difficult to purchase discounted commercial gas cylinders.” He added that small-scale cloud kitchens will be hit hard.