NRAI to step up gas on ONDC to challenge Zomato & Swiggy's dominance

Restaurant body to strengthen ONDC presence amid private labelling and high commission woes

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The National Restaurant Association of India (NRAI) -- country’s leading restaurateurs’ body -- has decided to step up gas on the government-backed Open Network for Digital Commerce (ONDC) to take on Zomato and Swiggy’s standalone apps for 10-minute food delivery, Bistro and Snacc.

 

NRAI and the Federation of Hotel & Restaurant Associations of India (FHRAI) -- which claims to represent over 60,000 hotels and 5,00,000 restaurants -- are up in arms against Zomato and Swiggy’s foray into quick food delivery.

 

In a quarterly meeting with representatives of ONDC and other food delivery platforms like Ola and Magicpin held on Tuesday, NRAI decided to replicate the success it achieved in Bengaluru.

 

“In Bengaluru, we have been able to convert 20 per cent of our orders via ONDC and feel that we can find that kind of success in other parts of the country also,” said Sagar Daryani, president, NRAI and founder of QSR chain Wow! Momo.

 

“We had a good meeting with ONDC on how it can become more effective and a tool for the democratisation of the delivery sector,” said Zorawar Kalra, vice president of NRAI and founder and managing director, Massive Restaurants. 

NRAI is planning to move to the Competition Commission of India (CCI) while FHRAI has written to the government alleging anti-competitive practices by both the food aggregators.

 

High commissions charged by traditional players is another reason for NRAI to strengthen its collaboration with ONDC.

 

Commissions charged by Zomato and Swiggy range between 15-30 per cent, while ONDC commissions are in the range of 5-7 per cent, an industry stakeholder told Business Standard.

 

Earlier this month, NRAI had accused Zomato and Swiggy of masking consumer data, engaging in private labelling, breaching trust of restaurant partners, and abusing their market position.

 

Outlining the issue of private labelling of food items by food aggregator platforms, FHRAI has written to the Ministry of Commerce, requesting urgent intervention.

 

The NRAI is also organising a town hall meeting on Wednesday for a discussion on aggregator platforms and if they’re hurting the restaurant business.