Food delivery giants Swiggy and Zomato are currently facing problems due to a boycott by the Gujarat Hotel and Restaurant Association. The protest is now into its second week as restaurant owners refuse paying the high commissions demanded by the two companies.
Also Read: Here’s Why Restaurant Owners In Bangalore Are Abandoning The Industry
The reason behind this protest
The main cause for this boycott is against the commissions charged by the foodtech companies which goes up to 22% of the order value. The association has also reportedly said it would not increase food prices as demanded by Swiggy and Zomato to accommodate the high commissions. It’s been more than 10 days since this boycott started
How Swiggy & Zomato have responded
As per industry estimates, Swiggy and Zomato together handle 70K to 80K takeaway orders with average order size worth Rs 270 per day in Ahmedabad city. According to a report, Swiggy has agreed to the demand of 100% payment for orders against cancellation and Zomato has agreed to give restaurants the right to deliver food by giving them the hybrid model option to enable self-deliveries.
The impact
The boycott has lead online food delivery platforms to face a 30% drop in their online deliveries, and yet they will continue the boycott, an industry association said.
