Profit squeeze drives India's restaurants to seek new delivery paths

Restaurants are paying the same commissions regardless of the distance they're sending their deliveries

- Varuni Khosla & Suneera Tandon

Facing a squeeze on profits from steep commissions and a lack of direct access to customer data, India's restaurant industry is seeking alternatives to dominant online food delivery platforms like Swiggy and Zomato.

Deep discounts demanded by these platforms are creating an unsustainable business model for restaurants, which are exploring partnerships with mobility firms like Rapido to deliver food and even contemplating legal action against Swiggy and Zomato.

"We want access to our consumer database. Restaurateurs realise that our marketing costs are really going through the roof in online ordering and it's a double-whammy as online ordering is also increasing as a pie of the entire orders served because ordering-in is now competing with dining-in footfalls," Sagar Daryani, president, National Restaurant Association of India (NRAI), told Mint on the sidelines of an industry event in Delhi on Wednesday.