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Zomato, Swiggy slammed over ‘private labelling’ by restaurants body: ‘Why should they charge?’
The NRAI had filed a petition with the Competition Commission of India (CCI) in 2021, accusing both Zomato and Swiggy of abusing their dominant market positions
The National Restaurant Association of India (NRAI) has raised concerns over food delivery aggregators like Zomato and Swiggy getting into private labelling and dining-in, alleging that they are drawing customers away from their restaurants, The Indian Express reported.
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Sagar Daryani, president of NRAI and CEO of WOW! Momos, said 10-minute food delivery apps such as Zomato’s Bistro and Swiggy’s Snacc are creating “an uneven playing field” for restaurants, the publication reported.
“They are getting products made from third-party commercial kitchens and selling them under their own private label," he said. "They have all our data – nothing stops them from migrating a customer who is ordering a samosa or a chai or a biryani or a momo from Zomato to Bistro and maybe at a better price because they don’t have the pressure of high commissions.”
He also highlighted how food aggregators have entered the dining-in space, charging commissions on reservations and attracting customers through high discounts.
“In delivery, there’s some service involved. In dining-in, there is no service involved," the report quoted Daryani as saying. “ They’re just bringing the customer to you. They have zero role to play in the entire experience of the customer. So why should they charge?”
He further added that "today, they are charging 3-5%, tomorrow they’ll make it 7% and 10% and 15%. You can’t trust them – they have just done lip service all these years and haven’t really walked the talk.”
However, Zomato CEO Deepinder Goyal said Bistro is not a threat to the restaurant industry and is also not a ‘private label’ or ‘Zomato kitchen,’ according to the report.
All of this comes after the NRAI had filed a petition with the Competition Commission of India (CCI) in 2021, accusing both Zomato and Swiggy of abusing their dominant market positions.
According to the report, the NRAI plans to update their petition with more recent complaints.
Daryani also has pushed to popularise alternative platforms such as the Department for Promotion of Industry and Internal Trade’s Open Network for Digital Commerce (ONDC).
