Top restaurant body, ONDC in talks to end ‘monopolisation’ by Zomato, Swiggy


A top Indian restaurant body held initial talks with officials of Online Network for Digital Commerce (ONDC) on June 21, according to sources close to the developments. Over the next couple of months, a mix of few large and smaller restaurants may join the network for a pilot on the interoperable e-commerce network after a requisite technology standardisation.

Meanwhile, a note prepared by ONDC on a potential collaboration with food outlets that was accessed by Moneycontrol said: “With multiple NPs (network partners) offering their services on the open network with no pre filters, it will help break away from current monopolisation/cartelisation of the online food delivery ecosystem.”

“Today’s was an introductory meet where ONDC explained to us about their vision of how restaurants can integrate and benefit by joining the network,” said a member of the National Restaurants Association of India (NRAI).

According to a person in the know, some preliminary discussions with an executive of one of the top pizza chains in the country has also happened.

Last year, the NRAI filed information with the Competition Committee of India (CCI) against foodtech majors Zomato and Swiggy, claiming that their practices have “appreciable adverse effects on competition”. Issues such as bundling of services, data masking, deep discounting, lack of transparency and exorbitant commission were highlighted in the submission.

“The current ecosystem of food deliveries is broken and yet no one is able to disrupt it as it will take an infinite amount of funding. At present, the business model of foodtech can’t let a third party handle the hyperlocal logistics even though restaurants and end customers might end up benefiting from such a thing,” said a restaurant owner who did not want to be named.

“That’s why the ONDC effort is worth giving a try where an integrated network may allow more localised food aggregators and intra-city logistics providers to come up. Ultimately, this has the potential to reduce commissions that restaurants have to pay and better prices for customers as well,” he said.

In the ONDC system, restaurant network partners (RNP) in different areas may solely focus on aggregating restaurants, onboard them onto the network and manage them post onboarding i.e. educating restaurants on how to conduct online delivery business, advise on packaging and hygiene norms, ensure food preparation as per service level agreements.

This RNP need not worry about building the consumer pipeline and delivery infrastructure as other NPs will focus on those areas. Moneycontrol explained the various building blocks of ONDC and how it will operate from a consumer, a platform and a seller’s perspective last week in this article.

Although ONDC pilots started at the end of April this year, people close to the developments say that it will take another 6-12 months for all the pieces of the puzzle to come together.

At present, Paytm Mall has signed up with the network as a buyer app. Tech companies like Amazon, Flipkart, Google, Shopify and retail majors such as ITC, Dabur and Hindustan Unilever are reportedly in talks to join the network.

According to the commerce ministry officials, 80 firms are currently working with the network and are at different stages of integration. Further, ONDC reportedly plans to add 150 retailers in five cities during the pilot phase.

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