Anurag Katriar, head of NRAI Mumbai Chapter, told FE that Zomato has also reached out to NRAI and a schedule to meet the Gurgaon-based food delivery firm is being worked out.
Representatives of Swiggy led by COO Vivek Sunder will meet members of the National Restaurant Association of India (NRAI) in the Capital on Thursday to present its case on NRAI’s claims that online food aggregators have been resorting to predatory market practices, hurting businesses of restaurants.
Anurag Katriar, head of NRAI Mumbai Chapter, told FE that Zomato has also reached out to NRAI and a schedule to meet the Gurgaon-based food delivery firm is being worked out. Earlier this week, NRAI sent letters to Swiggy, Zomato, Uber Eats and Foodpanda seeking a dialogue on the subject.
The NRAI had listed eight issues in the letter which was reviewed by FE. The restaurant body said food delivery firms engage in steep discounting, going up to as much as 70% throughout the calendar year, hampering businesses of restaurants. “It is pertinent to note that these discounts are most often funded by the restaurant operators, sometimes under veiled coercion,” the association said.
NRAI said restaurants are being charged “uneven and arbitrary” commission on the net bill value of the food by the delivery platforms. The body suggested commissions should be determined on the basis of logical metrics like average order value (AOV) or volume of business.
According to analysts, Swiggy delivered an estimated 59 million orders in FY18 and Zomato did 39 million orders. While Zomato earlier this year in a blog claimed that its revenues tripled to $206 million in FY19 from $65 million in FY18, Swiggy posted 232.17% jump in revenue to Rs 441.99 crore in FY18.
NRAI also expressed grievance over the flouting of contract terms by aggregators. The terms and conditions reached between an online platform and restaurant is not “sacrosanct” and often “lopsided”, favouring aggregators, the body claimed.
Further, NRAI said aggregators refrain from sharing customer data with restaurants which amounts to “disconnecting” them from customers. The body also voiced opposition to online platforms developing their own brands which they say create “grossly unfair playing field”, forcing restaurants to use the platform’s delivery services, unreasonable rules of engagement resorted to by them. Also, platforms’ parameters for ranking restaurants is not “consistent”, the association said.