On Thursday, the National Restaurant Association of India (NRAI) strongly opposed the leading restaurant aggregators Zomato and Swiggy entering private-label food delivery through their quick-commerce platforms.
NRAI condemns Zomato, Swiggy
The NRAI charged Zomato and Swiggy with leveraging their dominant market positions and access to restaurant data to introduce private-label food products directly or through subsidiaries like Blinkit Bistro and Swiggy Cafe/SNACC.
“Zomato and Swiggy, originally established as marketplace platforms, are now leveraging their dominant positions and access to restaurant data to venture into private-label food delivery either directly or via their subsidiary,” the NRAI disclosed, adding that it raises legal concerns under the Copyright Act and associated laws.
“This strategy not only cannibalises the business of restaurants that rely on these platforms but also raises serious concerns under the Copyright Act and related laws,” the association added.
NRAI President and Wow Momo! CEO Sagar Daryani said disapprovingly, “We were always given verbal assurances by the aggregators that they would never resort to private labelling. This is a breach of trust.”
Moreover, he pointed out the issue of consumer masking, stressing that restaurants do not have access to customer data collected by the aggregators.
The NRAI, representing over five lakh restaurants in India stated that this move breaches marketplace neutrality and impairs fair competition, creating a significant threat to the survival of restaurants nationwide.
The industry body further noted that Zomato and Swiggy exploited data derived from restaurant partners while launching competing products creating a conflict of interest.
Daryani affirmed that the NRAI is “absolutely not okay” with this development declaring the industry body would seek legal remedies while approaching regulatory authorities.
With the restaurant industry valued at Rs 5.69 lakh crore, the NRAI has urged restaurants, customers and regulators to work together and maintain ethical practices in the competitive food delivery space.
Incidentally, Swiggy recently introduced a new app, SNACC to deliver snacks, drinks, and meals within 15 minutes. Also, Zomato's quick-commerce subsidiary Blinkit newly introduced "Bistro" for delivering snacks, meals, and beverages within 10 minutes.
Moreover, Zomato started its 15-minute food delivery service in select cities, the particular tab is now visible on Zomato's Explore page. It focuses on quick-to-prepare, ready-to-eat meals sourced from select restaurants within a 2-kilometre radius.
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