HBI Staff | Hyderabad 
The Andhra Pradesh Hotels Association (APHA) has announced that its members will boycott Swiggy’s food delivery app starting October 14, 2024. At a media conference on October 4, APHA State President R.V. Swamy explained that this decision was driven by the significant losses restaurants have been facing, with 40% to 60% of their menu prices being eroded due to what he described as “unethical practices” by Swiggy.
Swiggy and Zomato, which entered the Andhra Pradesh market eight years ago, initially operated with zero commission fees for restaurants, Swamy noted. However, Swiggy’s commission rates have now risen to as high as 30%. APHA Secretary M. Nagaraju, Executive Secretary I. Raghuveer Shenoy, and Treasurer E.V. Purnachand were also present at the conference.
The association leaders expressed concern over financial challenges caused by delayed payouts, with delivery apps holding restaurant earnings for up to 12 days. This, they said, has placed smaller establishments under severe financial pressure. While Zomato has responded positively to APHA’s concerns in ongoing negotiations, Swiggy has refused to address the pressing issues raised by restaurant owners, they said.
APHA members also criticized Swiggy for imposing “uninformed discounts” on selective restaurants, with these discounts either being shared between the restaurants and the delivery app or fully absorbed by the latter. Additionally, they accused Swiggy of altering restaurant menus without consent and selling items at reduced prices, further harming restaurant revenues.
The association also objected to Swiggy’s strict refund policies, which leave restaurants at a loss in many cases. They highlighted the financial burden imposed by promotional fees charged by delivery platforms in the name of increased visibility and order generation, calling them “unethical and unfair practices.”
Swamy also raised concerns about Swiggy’s practice of charging commission on the Goods and Services Tax (GST) paid by the restaurants to the government, describing it as both illegal and unethical.
Source The Hindu
