Restaurant owners in Bengaluru have intensified their pushback against food delivery platforms Swiggy and Zomato, alleging that rising commissions, multiple platform charges, and promotional campaigns launched without their explicit consent are eroding already thin profit margins. More than 250 restaurateurs gathered at a meeting organized by the Bangalore Hotels Association (BHA), where members resolved to formally write to both platforms seeking resolution of their concerns before August 15. If no satisfactory response is received, restaurant owners have warned they may collectively suspend operations on the two delivery apps.
The dispute reflects growing tensions between restaurants and food delivery aggregators as eateries grapple with higher operating costs while relying heavily on online delivery for revenue. Restaurateurs argue that frequent additions of new platform fees and mandatory promotional campaigns have significantly increased the cost of doing business, particularly for small and mid-sized establishments.
Bengaluru Restaurateurs Unite Against Platform Fees
The meeting, attended by over 250 restaurant owners, focused on what participants described as a growing financial burden imposed by food delivery platforms.
According to the Bangalore Hotels Association, key concerns include:
- High commission charges on food orders.
- Introduction of new fees under different categories.
- Promotional campaigns allegedly activated without explicit consent.
- Shrinking profit margins for restaurants.
- Greater financial pressure on small and independent eateries.
Restaurant owners said they would submit a formal representation to Swiggy and Zomato outlining their demands and expect a response before mid-August.
Dispute Snapshot
| Item | Details |
|---|---|
| Organizations Involved | Bangalore Hotels Association, Swiggy, Zomato |
| Restaurateurs at Meeting | More than 250 |
| Main Issues | Commissions, platform fees, promotional campaigns |
| Deadline Given | August 15 |
| Possible Action | Suspension of restaurant listings on delivery apps |
Restaurants Object to Growing Fee Burden
Restaurant owners argue that the platforms have introduced several additional charges over time, making online orders significantly less profitable.
Among the concerns raised were:
- Multiple service-related fees.
- Marketing and promotional costs.
- Discounts allegedly applied without clear approval.
- Reduced earnings despite growing online sales volumes.
Several restaurateurs said smaller businesses are particularly vulnerable because they have limited bargaining power and depend heavily on food delivery platforms for customer reach.
Rising Costs Add to Industry Pressure
The disagreement comes as restaurants continue to face higher operating expenses, including:
- Food ingredient inflation.
- LPG and fuel costs.
- Employee wages.
- Rent and utility expenses.
Restaurant owners argue that increasing platform-related costs, combined with broader inflationary pressures, are making it increasingly difficult to maintain profitability without raising menu prices.
Cost Pressures Facing Restaurants
| Cost Area | Impact |
|---|---|
| Platform commissions | Lower margins on delivery orders |
| Additional platform fees | Higher operating expenses |
| Inflation | Increased ingredient and utility costs |
| Labour costs | Rising payroll expenses |
| Promotions and discounts | Reduced net revenue per order |
Food Delivery Platforms Under Growing Scrutiny
The latest dispute adds to a series of recent challenges facing India’s online food delivery industry.
In recent months:
- The Competition Commission of India dismissed a consumer complaint alleging abuse of dominance by Zomato, finding no prima facie case.
- Competition has intensified with newer low-cost food ordering platforms entering the market and pressuring established players on pricing and commissions.
The Bengaluru restaurant owners’ collective action highlights the increasing tension between delivery platforms seeking sustainable profitability and restaurant partners demanding more transparent and equitable commercial terms.
What Happens Next?
The Bangalore Hotels Association plans to formally communicate its concerns to both Swiggy and Zomato.
Restaurant owners are seeking:
- Greater transparency in fee structures.
- Prior consent before promotional campaigns are launched.
- A review of commissions and other charges.
- A structured dialogue with platform management.
If negotiations fail before the August 15 deadline, participating restaurants have indicated they may temporarily delist themselves from both platforms as a collective bargaining measure.
Looking Ahead
The standoff between Bengaluru’s restaurateurs and food delivery platforms reflects the broader challenge of balancing platform profitability with the financial sustainability of restaurant partners. As online ordering becomes an increasingly important sales channel, disputes over commissions, discounts, and promotional fees are likely to become more prominent, particularly among small and independent restaurants operating on thin margins.
Looking ahead, the outcome of discussions between the Bangalore Hotels Association, Swiggy, and Zomato could influence how food delivery platforms structure their commercial relationships with restaurant partners across India. A negotiated solution may encourage greater transparency and collaboration, while a failure to resolve the dispute could disrupt online food delivery operations in one of the country’s largest restaurant markets and prompt similar actions in other cities.
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