The members of Andhra Pradesh Hotels Association unanimously decided to boycott the services of the food delivery behemoth Swiggy across the state from October 14th. The decision was taken during the meeting of APHA in Vijayawada on Friday. The primary reason behind this stern decision from APHA emerges from the fact that Swiggy has been adopting unethical practices in rendering the delivery services by over charging the commission and also holding the payouts for an inordinate time.
APHA State president R.V. Swamy said a decision to this effect was necessitated as the restaurants were losing 40% to 60% of their menu prices due to “certain unethical practices of Swiggy”.He said that Swiggy and Zomato began operations in Andhra Pradesh eight years ago and initially operated with zero commission fees for restaurants. However, their commission rates has escalated up to 30%.
They said the delivery apps were holding the restaurants’ payouts for up to 12 days, putting enormous financial strain on smaller establishments and threatening their survival. “The APHA has held three rounds of talks with the food delivery apps Swiggy and Zomato. While Zomato responded favourably to most of the requests by the restaurants, Swiggy refused to address the pressing issues raised by the restaurant owners,” they said.
They accused Swiggy of making changes to restaurants’ menus without the consent of restaurants, often selling items at lower prices. The food delivery apps often enforce harsh refund policies, in which neither the customer nor the restaurant receives a refund, leaving the latter at a loss.
Citing the promotional fees being charged by the delivery platforms from them “on the pretext of more visibility and generating more orders”, they said it was “unethical and unfair practices”, resulting in a significant financial burden on restaurant owners.
“Swiggy not only charges high commission rates but takes commissions on the Goods and Services Tax (GST) payable by the merchant to the government, which is illegal and unethical,” said Mr. Swamy.