Mumbai, Jan 9 (IANS): The National Restaurant Association of India (NRAI) on Thursday strongly opposed the recent foray of food delivery platforms Zomato and Swiggy into private-label food delivery via their quick commerce (Q-com) apps.
The leading hotel industry body said in a statement that their move undermines the principles of fair competition and poses a significant threat to the viability of thousands of restaurants across the country.
The NRAI represents over five lakh restaurants, an industry valued at Rs 5.69 lakh crore.
"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," said the NRAI.
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.
Their entry into delivering food through private labelling and selling on their platforms and also delivering privately labelled food via their own quick commerce platforms such as Blinkit Bistro and Swiggy Cafe/Snacc fundamentally violates neutrality, creating an uneven playing field.
The NRAI said that by monetising data derived from restaurant partners, they are exploiting a conflict of interest that could decimate the very ecosystem they claim to support.
Sagar Daryani, President of the NRAI, said they are "absolutely not okay with Zomato and Swiggy doing private labelling and selling food by themselves".
"They have all our data which they do not share with us. For us, there is complete consumer masking," Daryani argued.
"We were always given a verbal assurance by the aggregators that they would never resort to private labelling. This is a breach of trust is what we feel. Our businesses will get severely impacted with these platforms launching their private labels," he noted.
The NRAI called on all stakeholders, including restaurants, customers, and regulators, to join hands in ensuring a fair and competitive food delivery ecosystem.