#LOGOUT against Food Aggregators
On 14th August, members of the National Restaurants Association of India (representing 5 lakh restaurants) launched a campaign against food aggregators – based on a 6-hour discussion over their WhatsApp group.
While that was quick, NRAI’s decision signifies how Indian restaurants have been feeling for quite some time – they are unhappy, upset & angry because even though they’ve been able to push more orders, most of them aren’t growing.
The problem with Dine-out & Discounted Delivery ⚔️
Zomato Gold was supposed to be an exclusive privilege for limited users (5-10k) across 80-100 partner restaurants but they ended up selling it to more than 1 lakh users and restaurants were forced to offer more freebies at their own expense – eventually making the operation unviable even with higher footfall.
While the delivery-model has been adopted widely, the pressures (by food aggregators) to provide deep-discounts for pushing sales has also caused similar problems (higher orders but lower margins) for restaurant owners, especially since food aggregators refuse to bear the discount expenses.
🧠 Crew’s take: Business will go on once the lesson is learnt
Food aggregator apps have tipped the balance in pursuit of higher profits for themselves. While that is understandable (given that they operate with the pressures of justifying their valuations), they will surely cooperate with restaurant bodies because their campaign can damage their model altogether, especially if a large number of restaurants decide to lobby against them.