Bengaluru Restaurants Threaten Swiggy, Zomato Boycott After Aug 15, Here's Why

Hotel and restaurant associations say high commissions, discount policies and payment deductions are hurting businesses; seek written assurances from both food delivery platforms.

Bengaluru’s restaurant industry has issued a strong warning to food delivery giants Swiggy and Zomato, saying eateries across the city could stop accepting orders through the platforms after August 15 if long-standing concerns over commissions and payment practices remain unresolved.

Hotel and restaurant associations have alleged that the current business model has become increasingly difficult for restaurants, especially smaller establishments, as multiple charges continue to eat into their earnings.

Talks Planned With Swiggy, Zomato Before Deadline

The Bruhat Bengaluru

Hotels Association (BBHA) is set to meet Swiggy next Monday, while discussions with Zomato are expected either later this week or the following week. During the meetings, the associations will submit a formal representation seeking a written response and concrete corrective measures before the August 15 deadline.

According to the associations, the outcome of these discussions will determine whether restaurants continue operating through the two food delivery platforms.

Restaurants Flag High Commissions, Multiple Deductions

The BBHA said commission charges currently range between 8-10% and can go as high as 28%, depending on the arrangement. In addition to these commissions, restaurants also incur expenses for advertisements, payment gateway charges and app visibility, which they say substantially reduce their margins.

The associations argue that these deductions have placed a disproportionate burden on smaller restaurants, making it increasingly challenging to sustain profits.

Industry Seeks Greater Transparency

Restaurant associations have demanded a more transparent settlement process and several changes to existing policies. Their key demands include ending automatic payment deductions triggered by customer complaints, compensating restaurants for orders cancelled after food has already been prepared, and providing detailed settlement statements that clearly explain every deduction.

They have also called for the removal of what they describe as one-sided contractual clauses and the appointment of dedicated relationship managers for restaurant partners.

Objection to Discount Campaigns

Another major concern raised by the associations is the introduction of discount campaigns and promotional offers without the consent of restaurants.

According to the industry bodies, such promotions directly impact restaurant profitability, as businesses are often expected to bear part of the cost without having a say in the campaigns. They have urged both Swiggy and Zomato to ensure that promotional offers are implemented only with the approval of restaurant partners.