Online food delivery services such as Uber Eats, Zomato and Swiggy are in for a tough time in Kerala, with the Kerala Hotels and Restaurants' Association (KHRA), the apex body of hotels in the state, deciding to take on the operators and develop an alternative delivery mechanism.
Online food delivery services such as Uber Eats, Zomato and Swiggy are in for a tough time in Kerala, with the Kerala Hotels and Restaurants’ Association (KHRA), the apex body of hotels in the state, deciding to take on the operators and develop an alternative delivery mechanism. The Kochi unit of the KHRA has decided to observe a token strike for 10 days from December 1 as they are not pleased with the existing arrangement and service charges.
The 40,000-strong association of restaurants and hotels has also taken a decision not to work with food delivery services in Kozhikode after commissioning a study of its own that reveals that such services will harm dining out in the long run. Currently, food delivery companies operate only in Kochi and Thiruvanathapuram and are set to launch operations in Kozhikode.
G Jayapal, general secretary of KHRA, told FE that the association has taken a formal decision of not cooperating with the app-based delivery from December 1 in Kochi as an initial step of resisting the growth of such companies that squeeze suppliers after establishing themselves with lavish offers. He added that these companies are establishing centralised kitchens in major cities after forging good relationship with customers.
“When customers get good discounts they will think that we are fleecing them. Actually, they have deep pockets and can afford to give discounts on their own. But after building a loyal customer base, they slowly start hiking prices just like app-based taxi services,” he said. “We have spoken to our peers in other southern states and have come to know that none of them is happy with the arrangements which promise increase in business. The KHRA is also looking at like-minded domestic companies which could help in app-based delivery service and not fleece hotels ,” Jayapal said. He said the restaurant business is going through a slowdown Kerala after the outbreak of Nipah virus and flood scares.
Muhammed Suhail, president of the Kozhikode unit of KHRA and owner of famous Rahumath Hotel, said hotels and restaurants are basically structured for fine dining, and takeaways in normal circumstances contribute to 10-15% of the total business. “They can help increase the business of small firms that have lower operating costs and they, in turn, get more service charges. In fact, we have seen them bargaining more with not-so-established brands. It is true that we cannot completely do away with these technology-based services and we will also think of an alternative mechanism.” Suhail said.