NRAI and food delivery platforms clash over private labels
The attention on the issue comes as Zomato and Swiggy launch standalone apps to offer 10-min food delivery fulfilled through private labels.
"We are getting sandwiched because of their (Swiggy and Zomato) competition with Zepto," said Sagar Daryani, CEO of Wow! Momo and President of NRAI, talking about the latest developments within food delivery space with aggregators launching their private labels through apps like Snacc and Bistro.
Daryani went on to comment that, while the shareholder and investor pressure is understandable, the quick food delivery offerings should have been solved alongside restaurant partners.
In an NRAI townhall titled "Are aggregators helping or hurting restaurant business?", Daryani claimed that restaurants were verbally assured by aggregators that platforms will not get into private labels.
According to him, dialogues between the two parties are ongoing.
According to a report by Economic Times, Zomato CEO Deepinder Goyal sent in a letter to the National Restaurants Association of India to address concerns from restaurant partners regarding the launch of private labels.
" In the past, I have expressed that Zomato, as a restaurant-aggregator, will never compete with its own restaurant partners, unlike players such as Amazon who sell their own private labels on Amazon," Goyal said in the letter, according to the report.
Blinkit CEO Albinder Dhindsa had also previously reiterated a similar stance during the launch of Bistro. In a post on X, Dhindsa had noted "Which is why this service is not being built within Zomato (the organisation which runs the brand, or the app). This is a standalone team, with a standalone app - and no Zomato restaurant data has been used. We will not even use the Zomato app to market Bistro."
This comes as the industry body, which represents over 500,000 restaurants in the country, plans to move to courts to seek intervention. NRAI also plans to approach the Competition Commission of India (CCI) for their apprehensions regarding standalone quick food delivery apps.
However, this is not the first instance of private label allegations on the platform.
"While the more popular ones (private labels) are Zepto Cafe, Bistro and Snacc; Zomato Everyday and Swiggy Daily are both private labels maybe wrapped in the disguise of home chefs. Essentially they (platforms) are controlling the pricing, the brand and the visibility on the app," noted Anshul Gupta, Co-Founder of EatClub Brands, which operates brands like Box8, Mojo Pizza, NH1 Bowls and Wefit, among others.
Restaurant partners are now looking rely on the government-enabled Open Network for Digital Commerce (ONDC), which offers buyer apps through Ola and magicpin that provides sellers access to customer data and trends.
Edited by Jyoti Narayan
