Sri Ram Bhavan, a small canteen tucked away in the narrow by-lanes of Udupi district of the southern Indian state of Karnataka, does brisk business selling local staples like idli, dosa, and coffee, among others, with close to 500 orders a day. However, contrary to expectations, none of these orders is facilitated by food-delivery apps Swiggy and Zomato.
The two foodtech giants are well integrated into the restaurant scene in the coastal temple town renowned for its cuisine—the ubiquitous Udupi eateries are found across the country. Swiggy alone processes nearly 1,000 orders a day, according to a former executive of the food aggregator.
Ajith Kumar, the owner of the small canteen—built in barely 700 sq ft with six tables—is also not averse to using digital technology, receiving nearly 30% of the payments via Unified Payments Interface (UPI). His reasons for not signing up on the apps are rather practical. “We offer only 50 items and are active in the morning and the evening. We go out of stock soon, so if people order, they may not get it. I don’t want that to happen to my customers,” says Kumar.
Also, commissions as high as 32% have kept Kumar from trying the food-delivery apps.
At a time of high inflation, these commissions hurt the restaurants even more, says Shivprasad Shetty, who runs nine restaurants in Udupi and sees 50% of his orders coming via the foodtech platforms.
Restaurant owners like Kumar and Shetty want an alternative that allows them more control over their earnings.
Small entrepreneurs from India’s tier-II and III cities see this dilemma as an opportunity. In late July, about 40 of them came to Udupi to brainstorm how they could build local alternatives to help create $100 million companies by leveraging the Open Network for Digital Commerce (ONDC)—the Indian government-sponsored e-commerce platform of platforms.
The ONDC seeks to do to commerce what UPI did to payments—make it open open open Where any company can participate and build on top of the payments system and interoperable interoperable interoperable The sender and receiver do not need to have the same app to make and get payments . Launched in 2016, UPI sees six billion monthly transactions, powering two-thirds of India’s online merchant payments. While UPI earned India bragging rights for building the most innovative digital payments system in the world, all eyes eyes Financial Times The future of global retail will be local Read more are now on the new commerce interface.