Dine-in restaurants are being cannibalized in regards with the deep discounts allotted by the online food aggregators. Competition Commission of India (CCI) reports that this is shifting burden on to the restaurants.
Restaurants feel that the aggregators are working based on the data driven from them to promote their own ‘cloud kitchen’ and the study informed that they are increasing the commission charged unilaterally and arbitrarily.
However, the online aggregators didn’t agree with the above statement, mentioning that they do
share data with dine-inrestaurants.
Previously there was an issue between National Association of India (NRAI) and few online food aggregators over the discounting practice.
The CCI study also informed restaurants saying that online platforms search ranking algorithms are not transparent and the ads are mixed with organic results.
The platforms while denying the statement claimed that organic listing and advertised listing are separable.
The study said “Nearly 78 per cent respondents have online presence and 69 per cent went online between 2016 and 2018 with three platforms on average.”
Denying the complaints of the restaurants, platforms said that they are bridging the gap in supply and demand while helping the restaurants to scale up. They are also giving surplus choices to the customers.
There already exists an agreement between NRAI and online delivery majors Swiggy and Zomato, to resolve the issues of the industries including the problems caused by discounts.
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