Bengaluru’s restaurant industry has issued a strong warning to food delivery giants Swiggy and Zomato, saying thousands of eateries could stop accepting online orders through the platforms after August 15 if long-standing concerns over high commissions, mandatory discounting, advertising fees and other platform charges remain unresolved.
The Bangalore Hotels Association (BHA), which represents a significant section of the city’s hospitality sector, said nearly 10 months of discussions with the delivery platforms have failed to produce a solution. According to the association, Bengaluru has around 34,000 hotels and restaurants, of which nearly 20,000 are listed on food delivery apps, meaning any coordinated action could affect a large number of consumers and businesses.
BHA president P. C. Rao said the platforms have been given 15 days to address the industry’s concerns, failing which member restaurants would jointly decide whether to suspend online orders. Restaurant owners argue that rising commissions and platform-driven promotional campaigns are forcing them to increase menu prices on delivery apps, ultimately making customers pay more while shrinking restaurant margins.
Swiggy and Zomato have not announced any changes to their pricing models, while the National Restaurant Association of India (NRAI) has backed the restaurants’ concerns but urged both sides to continue dialogue rather than resorting to a boycott.
Meanwhile, Rapido-backed Ownly, a new food delivery platform operating on a zero-commission model, is attempting to position itself as an alternative for restaurants seeking greater control over pricing and profitability.
Restaurants Cite Rising Costs
The Bangalore Hotels Association says the proposed boycott is not a sudden decision but the culmination of months of unsuccessful negotiations with food delivery aggregators over what restaurant owners describe as an increasingly unsustainable business model.
According to the association, besides commissions charged on every order, restaurants are expected to participate in platform-led discounts, promotional campaigns and paid advertisements, while also absorbing delivery-related deductions and service charges.
Owners argue that these cumulative costs significantly erode already thin profit margins in an industry that continues to grapple with rising food prices, rent, wages and utility expenses. BHA president P. C. Rao said restaurants have now reached a point where continuing under the existing model has become difficult and warned that member establishments would take a collective decision if their concerns remain unaddressed.
Restaurateurs also argue that customers are not benefiting despite frequent discounts displayed on delivery platforms because menu prices are often marked higher online to offset commissions. Arun Adiga, owner of Bengaluru’s iconic Vidyarthi Bhavan restaurant, said customers ultimately care about the final amount they pay and noted that delivery prices can be substantially higher than those charged directly by restaurants.
Suraj Madhnani, owner of café and patisserie Amintiri, warned that persistent financial pressure could eventually force restaurants to compromise on ingredient quality or reduce portion sizes to remain commercially viable an outcome that, he said, benefits neither businesses nor consumers.
Industry Debate Continues
The dispute reflects a broader debate over the economics of India’s rapidly expanding food delivery sector. Restaurant associations across the country have, over the years, questioned high commission structures, pricing policies and contractual practices that they believe leave restaurants increasingly dependent on digital platforms while limiting their ability to determine prices independently.
Similar concerns have previously been raised before the Competition Commission of India (CCI) as industry bodies sought greater transparency in the relationship between restaurants and aggregators. While supporting the concerns raised by Bengaluru’s restaurants, the National Restaurant Association of India (NRAI) has stopped short of endorsing a boycott.
NRAI president Sagar Daryani said it was unfortunate that restaurants felt so cornered that they viewed a boycott as their only remaining option, but emphasised that dialogue remains the most constructive path forward. At the same time, the ongoing dispute has created an opportunity for emerging competitors.
Rapido-backed Ownly has begun positioning itself as a zero-commission food delivery platform, with its leadership stating that the model aims to offer greater pricing transparency and allow restaurants to retain more of their earnings.
Whether such alternatives can challenge the dominance of established platforms remains to be seen, but the current standoff has renewed discussions around how digital marketplaces should balance consumer convenience, platform sustainability and fair returns for restaurant partners.
The Logical Indian’s Perspective
India’s food delivery revolution has transformed the way millions of people order meals, creating convenience for consumers, business opportunities for restaurants and employment for delivery workers. However, the current dispute in Bengaluru highlights an important question about whether every participant in this ecosystem is benefiting fairly.
Restaurants, delivery partners, technology platforms and customers are all interconnected, and any imbalance in the system eventually affects everyone from higher food prices and shrinking business margins to reduced consumer choice. As negotiations continue, a collaborative and transparent approach that protects innovation while ensuring fairness for small and medium-sized businesses will be crucial.
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