INDIA – The National Restaurant Association of India (NRAI) has called for the implementation of what it terms fair e-commerce policies that ensure a level playing field between restaurant and food delivery platforms.
NRAI expressed concerns over how delivery platforms appear to dictate terms related to commissions, pricing, and customer engagement in their partnerships, making it difficult for restaurants to maintain profitability in the delivery space.
The association acknowledges the transformation that has taken over the restaurant sector in the post-pandemic era.
According to NRAI, prior to the COVID-19 pandemic, food deliveries accounted for only 10-12% of restaurants’ revenues. However, this proportion has surged to 40-50% in 2024, presenting both challenges and opportunities.
NRAI has faulted the duopoly that exists in the Indian market from Zomato and Swiggy, who the association blames for straining restaurant partners.
The association blames the unchecked duopoly for imposing high commissions that have increased costs and eroded profit margins, making it difficult for restaurants to sustain operations.
NRAI has also faulted delivery platforms for putting pressure on restaurants to offer substantial, unsustainable discounts to attract customers and maintain visibility on their platforms.
Sagar Daryani, Vice President of the NRAI also faulted delivery platforms for limiting restaurants’ access to customer data or contact details, which makes it difficult for restaurants to track and understand customer patterns and preferences.
Daryani described this as a lack of transparency between platforms and restaurants.
NRAI’s Vice President called for greater protection from unfair competition and transparency through policy. Daryani reiterated platforms should act as partners and not competitors.
He also urged the central government to reinstate input tax credits under the goods and services tax (GST), a benefit that was previously available under the value-added tax (VAT) regime.
Daryani said, “If we were allowed GST input credits, we could potentially open 12 stores for every 10, creating more jobs and contributing to government revenue.”
The NRAI represents the interests of restaurants across 24 cities, encompassing over 5,000,000 establishments, from single-restaurant owners and kiosk operators to major chains like Domino’s.
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