Jubilant FoodWorks is gearing up to launch Domino’s Pizza on the government’s Open Network for Digital Commerce (ONDC) platform, the fast-food chain said in an earnings call.
“We are organising ourselves to launch Domino’s on ONDC. Wherever customers are, we want to serve them with Domino’s Pizza,” Sameer Batra, president and chief business officer at Jubilant FoodWorks, said, adding that the company was working on tech integration ahead of the debut on ONDC. Batra, however, did not specify a timeline for the launch.
The restaurant industry has been betting big on the ONDC platform, which has challenged the duopoly of food delivery partners such as Swiggy and Zomato in recent months, sector experts said.
Currently, aggregators such as Swiggy and Zomato charge platform commissions from restaurants in the 20-30% range, while on ONDC it is around 8-9%, analysts said.
Restaurant majors such as McDonald’s, Biryani Blues, and Wow! Momo, among others, have already onboarded or are in the process of doing so on ONDC, industry sources said.
Large discounts have propelled ONDC’s daily orders to 25,000 per week, which retail experts say is a short-term strategy.
“On the face of it, lower prices make ONDC compelling. However, this does not seem to be based on the principle of inefficiency elimination, but on the fair amount of subsidy (up to `125 per order) that ONDC offers,” brokerage house Jefferies said in a recent report on ONDC.
Once ONDC withdraws the incentive scheme, either the restaurants or the customers will have to pay for delivery, Jefferies said.
If ONDC decides to absorb the bulk of delivery costs, they will have to charge higher commissions from restaurants, resulting in higher listing prices and impacting order volume, the brokerage added.
ONDC also does not maintain large delivery fleets like its competitors. Instead, it relies on third-party delivery platforms like Shadowfax for deliveries, which eliminates the operational costs of managing and growing a fleet, it said.
Jubilant FoodWorks, in this case, has the upper hand because it manages its own pizza deliveries — even for orders that are placed on food aggregator apps — with a promised timeline of 30 minutes, said experts.
The company has begun trial runs of its 20-minute pizza deliveries in Bengaluru, where Domino’s has a network of 175 physical stores, with plans to gradually extend this quick service to 6-7 of the other top metro cities, including Mumbai and Delhi.