Hotels vs Zomato tiff deepens: More restaurants will follow, warns body; also asks for tweak in Gold

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Updated: October 17, 2019 10:28:16 AM

The restaurant bodies including FHRAI and NRAI have been persistent in their demands that food aggregators must stop extending deep discounts and also stop levying high commission rates.

ZomatoThe group consisting of several hotelier bodies has also demanded tweaks in Zomato’s paid subscription program called Zomato Gold.

Even after months that food aggregator Zomato got embroiled in a controversy with thousands of restaurants across India, the issue has only worsened with more restaurant bodies joining the logout campaign. The restaurant bodies including FHRAI and NRAI have been persistent in their demands that food aggregators must stop extending deep discounts and also stop levying high commission rates, among others. The hotel bodies have also said that more restaurants will follow suit in the logging out campaign if their demands are not met. 

“These aggregators, who are heavily funded by Private Equity Funds, have to recognize that their role is that of a ‘market-place and/or a service-provider’, akin to a travel agency or a discovery platform … They cannot decide or dictate commercial terms to and on behalf of the Industry,” Gurbaxish Singh Kohli, President, HRAWI & Vice President, FHRAI, said in a statement on Wednesday. 

The group consisting of several hotelier bodies has also demanded tweaks in Zomato’s paid subscription program called Zomato Gold. “Gold is an extremely detrimental product. It is clothed in such a manner that it misleads a few gullible members into disastrous consequences,” Katriar, President, NRAI, said. However, Zomato denied the allegations made by the restaurants body. “All of these are baseless allegations, and we would only classify them as false propaganda,” a Zomato spokesperson said. 

Zomato had earlier terminated Infinity Dining program as the company looks to “incorporate various feedbacks that it has received about the service,” and had also proposed changes in Gold program to appease the restaurant body. Later, Zomato extended its Gold subscription to delivery orders as well, irking the restaurants further. 

Meanwhile, Zomato released its financials early in October and dissed any impact of the logout campaign launched in August. “At the start of the campaign, we had about 6,100 restaurants in India on Zomato Gold (for dining out); as of today, we have about 6,300 restaurants,” Zomato had said in a statement. 

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