Kerala Hotels, Restaurants to Launch Strike Against Swiggy, Zomato, Uber Eats

Popular app-based food aggregator services, such as Swiggy, Zomato and Uber Eats are set to lose ground as the Kerala Hotels and Restaurants Association (KHRA) has decided to distance itself from these platforms, and is also considering creating a new one.

To begin with, the Kochi unit of KHRA has decided to observe a 10-day token strike expressing their displeasure over the existing arrangement and service charges. KHRA, the apex body of hotels and restaurants across the state, also said there were plans to create an alternative platform of their own.

Pointing out how such app-based food service providers win the hearts of customers, G Jayapal of KHRA said accused food aggregator services of squeezing suppliers after establishing themselves as a credible service with a handful of offers.

Naturally, the customers think that hotels and restaurants are fleecing them since they get offers through these aggregated services, he said, adding that after establishing a customer base, these companies gradually start increasing the prices. This is what happened in the case of app-based taxi services, too, said Jayapal. 

Read More: Ola and Uber Drivers Continue Facing The Same Old Problem, And Then Some More 

‘Same Story as Cab Aggregators’

Drivers of Ola and Uber, the app-based taxi aggregators, have for long been raising their concerns and even took to streets and struck work in different cities, including Delhi and Mumbai.

Offering opportunities for enhancing income, Ola and Uber's services were introduced in India in 2011 and 2013, respectively. A large number of people, especially from the lower-middle-class, invested in these services, dreaming of a better life and wages. 

Due to a boom in the initial phase, drivers did manage to earn well. As a result, several people turned to these services, leaving behind their low-paying jobs. Some even sold their properties.

But once these companies had enough workforce -- cab owner-drivers -- the incentives were slashed.

“In the beginning, they charged a commission of around 15%, while the drivers were earning around Rs 15-16 per km along with the incentives and other schemes, for example, for covering a certain distance or completing a certain number of rides. Now, we earn Rs 6 per km, but the commission is between 25-30%, while the incentives have been cut back,” Kamal Jeet Gill, president of the Sarvodaya Drivers Association of Delhi had told Newsclick earlier. 

Pointing out the similarities, Jayapal said, a food app company buys a dish from us, say, for Rs 100, and sells it for Rs 80. Naturally, the customer will be attracted to the aggregator services. And once they have enough loyal customers, they will hike the prices. This will affect hotels and restaurants and would force small and medium hotels to shut down their services, he feared.

Read More: The Uber “Problem” 

“At present, hotels and restaurants have to pay 30% commission to Uber Eats. For Swiggy, it is more than 20%, he said.

Another hotel owner said, “Earlier the companies charged 15% as commission. When there was a boom in orders, they hiked it to 17%. Now it is 20% for Swiggy. I don’t have any clue how much further it would increase.”

It for this reason that KHRA decided to go on a strike. “This is the question of our existence and we will observe the token strike for 10-days,” he added.