Will Domino’s really walk away from Zomato and Swiggy in India?
The pizza chain is considering taking some of its business away from the popular food-delivery apps if their commissions are hiked further, according to Reuters, which saw a confidential filing Jubilant FoodWorks, its India franchisee, made with the Competition Commission of India (CCI).
“In case of an increase in commission rates, Jubilant will consider shifting more of its businesses from online restaurant platforms to the in-house ordering system,” the company stated in its July 19 letter.
While the restaurant aggregators haven’t commented, the Zomato CEO has confirmed that the commission rates aren’t coming down anytime soon. “We are not profitable. We need to make some more money from somewhere. So, absolutely not taking rates down,” Deepinder Goyal said earlier this month.
The restaurants’ protest against Zomato and Swiggy
Over the years, several smaller restaurant owners have opposed commission rates running up to 25-30%. These platforms may be helping with discovery and logistics, but at what cost?
In April, India’s competition watchdog began investigating the alleged anti-competitive practices of Zomato and Swiggy. The probe began following complaints from the National Restaurant Association of India (NRAI), a body of more than 500,000 members.
Compared to smaller local eateries, it’s perhaps easier for Domino’s, which has 1,500 outlets across India, to dissociate from these food-delivery behemoths. It has its own app, which was downloaded more than 8 million times in the quarter ending December 2021, Jubilant said in February.