Rapido's disruption bid faces uphill task in food delivery

WHILE RAPIDO IS eyeing a disruption of the entrenched Zomato-Swiggy duopoly in the food delivery space by offering a model where online prices remain the same as offline, analysts remain skeptical about the feasibility and sustainability of this approach.

- RAGHAV AGGARWAL

The ride-hailing platform plans to leverage its existing fleet of 3 million riders and previous experience with ONDC and Swiggy to build a separate food delivery platform. Its pitch to restaurants includes significantly lower commissions than what is currently charged by Zomato and Swiggy. While this has stirred conversations about a potential shake-up, brokerage firms and analysts caution that hurdles ahead are formidable.

"We do not anticipate material market share impact from Rapido's entry," said Bernstein in a research note on Wednesday. It pointed to earlier failed forays into food delivery by Amazon, Ola, and ONDC. "These players struggled with poor restaurant selection, inconsistent customer experience, and the complexities of managing fragmented supply chains in India," it said.

At present, Zomato and Swiggy dominate the market with 54% and 46% shares, respectively, leaving little room for new entrants to make inroads without significant innovation or capital investment.