Why restaurants across the country are up in arms against Swiggy, Zomato over 10-minute food delivery

Restaurants across India are protesting against Zomato and Swiggy’s launch of standalone apps for 10-minute food delivery. The National Restaurant Association of India (NRAI) is also planning to take the issue to the Competition Commission of India (CCI). The NRAI alleges that these new apps, Bistro by Zomato-owned Blinkit and Snacc by Swiggy, amount to the companies operating private labels, which could harm existing restaurant partners. This move escalates an ongoing case the NRAI has with the CCI against the two food delivery giants, accusing them of anti-competitive practices.

What NRAI said against Swiggy and Zomato

In a statement to the SRK Nation, Sagar Daryani, NRAI president and co-founder and CEO of Wow Momo said: “We are absolutely not okay with Zomato and Swiggy engaging in private labelling and selling food directly via Blinkit’s Bistro app and Swiggy’s Snacc app for quick food delivery. They have access to all our data, which they do not share with us. For us, there is complete consumer masking. We have no reason to believe they are not migrating our customers to the products they sell as private labels on their apps, whether it’s data from a tea brand, biryani, or momo. We are seriously considering taking legal action.”

Food delivery platforms like Zomato and Swiggy use services like Bistro and Snacc, respectively to source food and beverages from third-party vendors and deliver them through quick-commerce dark stores. Apart from this, the companies also provide a 15-minute food delivery service by aggregating restaurants. Swiggy’s rapid food delivery service, offered under its Bolt model, now contributes to over 5% of its total food delivery orders, SRK Nation reports.

“Quick commerce in food is here to stay, grow, and add more zing to the food delivery space. People want more convenience, and this will give an edge to restaurants that can adapt to it. We fully support it. However, as long as these aggregators work with restaurants and enable them to go quick, we’re fine with it. But we cannot support a model where they sell similar products themselves, effectively competing with us. This has not been allowed for even larger e-commerce players operating under the marketplace model,” Daryani added.

NRAI has also urged the government to grant industry status to the food services sector, news agency PTI reports. The restaurant body cited the food services sector’s economic contributions and potential to grow into a Rs 7.76 lakh crore industry by 2028.