Zomato founder said that the company will “work with the industry and make modifications … which will result in a win-win situation for restaurants and consumers.”
Days after Zomato founder Deepinder Goyal penned his thoughts on restaurant and hotel industries’ grievances with food aggregator applications, a hotelier’s association called on major players in the food delivery segment to address the issues of the industry and arrive at a win-win outcome. Zomato, Swiggy, Nearbuy, Dineout Prius Heights, EasyDiner and Magicpin have been asked to review their policies by the Federation of Hotel & Restaurant Associations of India and the organisation also pointed out unethical business practices of the aggregators. “As a technology partner, by merely hosting its members’ inventory, Food Service Aggregators (FSA) cannot hold sway and arm-twist the traditions and aspirations of millions of entrepreneurs in India,” FHRAI said.
Accusing FSAs of impractical, unaffordable and unconscionable discounting, FHRAI Vice President said that the contracts are usually one-sided and unfair towards start-ups as against established brands. “The agreement terms are not sacrosanct as they are frequently and unilaterally changed from time to time and always in favour of the FSAs. Gurbaxish Singh Kohli, Vice President, FHRAI said in a statement. He also said that FSA’s are levying high commissions from hotels and restaurants.
Meanwhile, Zomato founder said that the company will “work with the industry and make modifications … which will result in a win-win situation for restaurants and consumers.”
8 – What’s good for restaurants is good for Zomato. What’s good for consumers is good for Zomato. Finding the right balance and product market fit is the restaurant industry’s problem (and that includes us).
— Deepinder Goyal (@deepigoyal) August 17, 2019
Food aggregators under fire
Reports of multiple hotels delisting from dining out services surfaced days ago as restaurants owner allegedly reel under heavy discounts. Under the campaign called #logout, over 1,200 restaurants across cities signed off platforms such as Zomato and Swiggy. Following this, Zomato’s founder Deepinder Goyal admitted that they have made certain mistakes and things didn’t go as planned for the company. In a series of tweets, Goyal said that the delisting is “a wake-up call that we need to do 100x more for our restaurant partners than we have done before.”