This strategy not only cannibalizes the business of restaurants that rely on these platforms but also raises serious concerns under the Copyright Act and related laws; National Restaurant Association of India grossly condemns Zomato & Swiggy
FinTech BizNews Service
Mumbai, January 10, 2025: The National Restaurant Association of India (NRAI), representing the
collective voice of the Indian restaurant industry, strongly opposes the recent foray of food delivery
giants Zomato and Swiggy into quick commerce through private-label food delivery. This move
undermines the principles of fair competition and poses a significant threat to the viability of
thousands of restaurants across India.
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. This strategy not only cannibalizes the business of restaurants that
rely on these platforms but also raises serious concerns under the Copyright Act and related laws.
Violation of Marketplace Neutrality
As marketplace platforms, Zomato and Swiggy were built on the premise of providing equal
opportunities for all restaurant partners. Their entry into delivering food through private labelling
and selling on their platforms and also delivering private labelled food via their own quick
commerce platforms such as Blinkit Bistro and Swiggy Café / Snacc fundamentally violates this
neutrality, creating an uneven playing field. By monetizing data derived from restaurant partners,
they are exploiting a conflict of interest that could decimate the very ecosystem they claim to
support.
Legal Recourse Underway
The NRAI views this as a clear case of misuse of private labels, infringing upon intellectual property
rights under the Copyright Act. We are committed to pursuing all available legal remedies to
safeguard the interests of the restaurant industry. This includes filing complaints with relevant
regulatory authorities and initiating legal action to prevent Zomato and Swiggy from monopolizing
the market.
Speaking on the announcement, Sagar Daryani, President of the NRAI, said:
Quick commerce in food is here to stay, grow and add more zing to the food delivery space. People
want more convenience and so it will add an edge to the restaurants that can adapt to it. We are
completely for it. What we are absolutely not okay with is Zomato and Swiggy doing private
labelling and selling food by themselves. In Zomato via Blinkit’s separate Bistro app and Swiggy
launching Snacc for quick food delivery.
They have all our data which they do not share with us. For us there is complete consumer masking.
We have no reason to not believe them migrating our customer to the products they sell as private
labels on their apps. Be it data from a tea brand, biryani or momo. We are definitely considering
taking a serious legal route. As long as these aggregators are okay working with restaurants and
enable restaurants to go quick, we’re absolutely fine with it but we will not want to be demolished
as an industry where they end up selling our similar products. This has not been allowed for even
larger E commerce players operating in the marketplace.
We were always given a verbal assurance by there aggregators that they would never resort to
private labelling. This is definitely a breach of trust is what we feel. Our businesses will get severely
impacted with these platforms launching their private labels.
The NRAI calls on all stakeholders, including restaurants, customers, and regulators, to join hands in
ensuring a fair and competitive food delivery ecosystem. Together, we can safeguard the future of
India's vibrant culinary landscape.
