Recounting his presentation to Mint, he said, “I showed them I’m not getting any revenue from online sales. It’s just a waste of time, waste of material, and waste of manpower.”
Thereafter, Murugan said, others began sharing their experiences, and some were horror stories. One restaurateur did ₹3,000 in sales in a week and got zero in return. When he did ₹5,000 in sales, he got just ₹100 after deductions.
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For Namakkal’s restaurants, commissions paid to delivery platforms Swiggy and Zomato have been rising for years—up from about 16% six years ago to as much as 25-30% now. Add in “hidden costs” and other deductions, as Murugan called them, and the total revenue loss climbs to 40-45%. The last six months, he claimed, have been particularly brutal.
The association requested a meeting with the platforms. Representatives from both sides sat across the table, but nothing came of it. Murugan said the platforms told the restaurateurs that lowering commissions in Namakkal would require them to be lowered nationwide, something they weren’t willing to do.
On 1 July, the restaurateurs decided to go for a divorce. Almost every restaurant in Namakkal, except for centrally managed chains such as KFC, pulled their menus from Swiggy and Zomato. Instead, they turned to Zaaroz, a local delivery platform offering a flat subscription fee: ₹1,500 plus GST per month for up to 100 orders and ₹3,000 plus GST for anything above that cap.
Swiggy maintains that most restaurants have returned and volumes are back to normal. But a quick check around noon on a Thursday showed at least three dozen eateries live on Zaaroz but missing from Swiggy. In just 40 days, Zaaroz has clocked about 12,500 orders.
The transition hasn’t been smooth. Orders across the town have halved from 700-800 per day to around 350-400. But Murugan remains confident. Prices on Zaaroz are the same as those in restaurants, unlike on Swiggy and Zomato, where restaurants inflate prices to offset commissions, he noted.
“It’s tough, but organically we believe we can capture the market in six months to a year,” said Murugan. “If you’re doing ₹1 lakh in orders and only getting back ₹30,000, it’s a waste. Doing ₹30,000 and getting back ₹30,000 is more profitable.”
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Across India, similar calculations are being made by restaurant owners. Both Swiggy and Zomato have reported a slowdown in food delivery growth in recent quarters. As they lean more on commissions and additional charges on restaurants and customers, many restaurant owners say the relationship feels less like a partnership and more like a dictatorship.
Over recent weeks, Mint spoke with over a dozen restaurant owners, delivery partners, and industry experts to piece this narrative together and sketch this picture of an industry at a crossroads.
The Squeeze
About three months ago, Zomato sent an email to restaurants announcing a long-distance service fee for facilitating the delivery of orders beyond 4 km— ₹20 per order for 4-6 km and ₹40 per order over 6 km. “Our endeavour is that each order should be profitable for you, and us,” the company said in an email.
Just last month, the company launched an ‘uptime pack’ for restaurants, offering higher visibility on high-demand days, such as festivals. ‘The fee, ₹250- ₹750 per week, would be deducted from the weekly payout,’ a pitch draft of the new service, seen by Mint said. However, according to industry watchers, amid pushback from restaurants, the service was soon rolled back.
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The cost of working with these platforms for restaurants has been rising, and the margins of small food businesses, in particular, have been shrinking.
Both Swiggy and Zomato typically charge restaurants a commission ranging from 15-30%, depending on the scale of the business, with smaller businesses often paying higher commissions. Most restaurants say nearly half the order value disappears before it even reaches them.
Explaining the math, restaurateurs indicated to Mint that on an order of, say, ₹300, about ₹75- ₹90 goes to the aggregator as commission, while about ₹60- ₹90 is lost in discounts; ₹15- ₹30 goes towards marketing on the platforms just to stay visible. In the end, a restaurant is left with only ₹150- ₹90 out of an order worth ₹300. This is a generalized estimate and the actual numbers can be higher or lower depending on each restaurant’s commissions and ad spends.
“Pre-covid, commissions were as low as 8-12%. Now, the base commission is 33% and with payment gateway charges, marketing costs, taxes, the sky’s the limit. Cost-per-click (the cost a restaurant pays when a user clicks on the ad listing by a restaurant) used to be around ₹1.25 but now it is more than ₹7,” the owner of a restaurant chain based in Assam told Mint.
While Zomato declined to respond to Mint’s detailed questionnaire, a Swiggy spokesperson said commissions and other chargeable services are arrived at on the basis of a mutual agreement with every restaurant partner. On the question of several restaurants losing over 50% revenue to platforms, the company said this simplistic argument ignores the complex ecosystem that provides multiple advantages to the restaurant partner community.
“Cloud kitchens today are thriving without having a frontal face to the end consumer by way of customer access that we provide to them. Restaurant partners also have the ability to service customers for longer last miles in addition to the immediate catchment, along with many other benefits that we enable for them,” it said.
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The silence
Spiralling costs aren’t the only concern for restaurants. Owners are also upset over arbitrary discounts, hidden features and a near-total lack of communication from the platforms.
Several restaurateurs allege that Swiggy and Zomato launch discounts or even enable dine-in reservations without their consent. “For a few days, we had people walking in saying they had a reservation. We were shocked because during onboarding we had clearly told the Zomato representative that we only wanted delivery, not dine-in,” said Rachel Lama, co-owner of an eatery serving momos in Indiranagar, Bengaluru. “We’re a 20-seater place. People had travelled from far, and they were obviously upset.”
The bigger issue, Lama said, was silence from the company. “Zomato never informed us before or after, and when we tried to reach our account manager, she wouldn’t respond for months.”
The chaos forced the restaurant to cut down its menu and eventually delist from both Swiggy and Zomato. “We realized this in time,” added co-owner Nirav C. “But a lot of restaurants end up struggling.”
Nirav shared emails from Zomato announcing discounts ‘as discussed’ with a person he had never heard of. The fine print read: If you do not want this, click here.
That, restaurateurs say, is the trap. “If you aren’t constantly checking and rejecting these emails, the discounts go live automatically,” said Ashok Singh Bhati, who runs Momos and Chaap in Indiranagar.
When Zomato began running discounts on PJ’s Italian Kneads, a Delhi-based restaurant, without consent, owner Pratyaksha Sharma asked for an explanation. To her surprise, the representative replied that it was because she was offering similar discounts on Swiggy. “But how is that their concern?” she asked.
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Despite the pushback, delivery companies continue to add restaurant partners at a healthy rate. Zomato, in its first quarter results for 2025-26, stated that it had 313,000 restaurant partners, a growth of over 13% from the year-ago quarter. The average monthly transacting restaurant partners for Swiggy also rose by a similar figure—14% to over 255,000.
However, the average gross order value (GOV) per restaurant partner, per month, has not grown meaningfully, and has been hovering around ₹103,000 for Swiggy and ₹110,000 for Zomato over the last eight quarters, estimated Harsh Poddar, partner at Incremento Business Advisor, a financial advisory firm. He derived the number from the data available in quarterly reports.
This average GOV number, he said, also includes delivery charges, platform charges, and so on, which have been increasing recently, thus leaving less money on the table for the restaurant partners.
The breakaway
Across towns and cities, many restaurants are beginning to chart their own course. From integrating orders through WhatsApp to using Uber and Porter for direct deliveries, to investing in Meta ads, restaurants are trying multiple ways to cut their reliance on Swiggy and Zomato.
Some, like Lama and Nirav’s momo eatery and the restaurant chain in Assam cited above, have removed themselves from the aggregator platforms. Lama is now considering partnering with Mappstore, which allows restaurants to take orders through WhatsApp, pay within the chat, and get food delivered through Porter and Shadowfax integrations.
The Assam-based restaurant chain’s breaking point came when Zomato added an extra ₹25- ₹35 charge on every order beyond 4 km. “That is when I switched off Zomato and Swiggy,” said the owner. “The unit economics are better now. On Zomato, I had to divert profits from dine-in just to keep online afloat. Online operations eventually suck you dry.”
Freed from the costs of commissions, the restaurant has shifted its focus from marketing to hiring trainers and consultants to improve the service. “Customers are happier, we are making profits, and the employment we create now is meaningful, unlike with the gig economy,” he said.
Still, breaking away isn’t simple. Many restaurants cannot afford to delist from the platforms completely. Petpooja, a restaurant management software company powering billing and order systems for about 95,000 restaurants across the country, has a window into the numbers. Founder Parthiv Patel told Mint that of all the orders flowing through Petpooja’s systems today, about 25-28% are via Swiggy and Zomato. By contrast, just 0.1% come from restaurants’ own apps or websites. The rest of the orders are dine-in or takeaway.
Of all the orders flowing through Petpooja’s systems today, about 25–28% are via Swiggy and Zomato. By contrast, just 0.1% come from restaurants’ own apps or websites.
For many of these restaurants, the middle path is to run in parallel, staying visible on Zomato and Swiggy while trying to nudge customers toward direct orders. This also helps restaurants build their own database of loyal patrons, information that platforms keep private.
“We didn’t know what customers ordered or how to reach them on these platforms. On Zaaroz, I get that information,” said Murugan of Namakkal. “In six months, I’ll know who my regulars are and can reward them with discounts. That’s how we’ll slowly build a market of our own.”
As Bhati of Momos and Chaap put it, “We are only on Swiggy/Zomato for visibility—70% of my business is dine-in customers and I encourage them to order directly if needed,” he said, showing the writer WhatsApp chats with customers.
Frustrated with unapproved discounts and high commissions from food aggregators, Sharma of PJ’s Italian Kneads has started investing in Meta ads to pull customers in directly.
For delivery, some are hiring a handful of staff on payroll. Others ask customers to book a Uber or Porter rider to pick up meals.
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A few, including Aaditya Goenka in Ujjain, Madhya Pradesh, are delivering on their own. The founder of Goenka’s Rasoi had barely joined Zomato when the new rules came into effect. His restaurant, still available on Swiggy, is now leaning on WhatsApp and his own website to build a direct ordering channel.
“We were live for only a few days before the new rules dropped and the economics did not make sense,” he recalled. For now, he is personally handling deliveries but plans to expand by hiring staff.
End user pushback
On their part, some customers are now bypassing Swiggy and Zomato altogether, and choosing to order directly from restaurants.
For Mumbai-based Reshma Bhatnagar, it’s been a far better experience. “I just call the restaurant and they deliver. Thanks to cheap e-scooters, their boys are prompt. The service is better and I’ve deleted both Zomato and Swiggy from my phone,” she said. Bhatnagar usually finds contacts on Google or uses menus slipped into newspapers.
In Kolkata, Swaraj relies on direct orders as well. “There’s a South Indian place near me. I call, they share a UPI code on WhatsApp, and even ping me five minutes before my food is ready,” he said. “With apps, prices are easily 30% higher with all the charges, and delivery takes longer because of grouped orders,” he added.
Grouped deliveries, which were once optional, have now become mandatory on Swiggy, largely because of a shortage of riders, according to industry experts.
“A large chunk of delivery partners now prefer quick commerce gigs,” a Zomato employee told Mint. “Food delivery involves longer wait times, and there’s no compensation for waiting.”
Food delivery involves longer wait times, and there’s no compensation for waiting.
—A Zomato employee
That shift is reflected on the ground. Several delivery workers said they have moved from food delivery to quick commerce for shorter distances and better earnings. “In food delivery, they’ll send you to far-off places. Here, I can just go back to the same store and keep doing trips,” said a Blinkit worker who didn’t want to be identified. “I make 60 orders a day now, compared to 30-40 earlier. Most of my friends have also moved fully to instant delivery.”
Blinkit is a subsidiary of Eternal, the parent of Zomato.
The Swiggy spokesperson claimed there’s no shortage of delivery workers: “Batching has absolutely nothing to do with shortage of delivery riders but is a standard industry practice, both in India and globally. It is viable both from an ecological and an economical standpoint.”
What next?
For Swiggy and Zomato, the commission-heavy model is facing its toughest test yet. While restaurants are rebelling and some customers are turning away, a clutch of new platforms is trying to loosen their stranglehold on the delivery business.
Rapido, better known for bike taxis, has recently started food delivery, while smaller challengers such as Zaaroz are positioning themselves as friendlier partners to local eateries. Mappstore and Foodpe are using Whatsapp integrations to smoothen restaurant delivery operations. But challenging the entrenched duopoly is anything but easy. Several earlier attempts, such as Thrive and Kerala-based Rezoy, fell by the wayside.
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Zaaroz, based in Chidambaram, Tamil Nadu, charges restaurants a fixed monthly fee, and is currently focusing on small towns. Attempting to convert dissent into delivery, after Namakkal, the company has launched in Rasipuram and Tiruchengode in Tamil Nadu, both cities where restaurants have been delivering through Swiggy and Zomato.
It is prudent for restaurants to diversify their sales channels to avoid over-dependence on a single platform, said Roma Priya, founder of Burgeon Law, a legal advisory firm for startups and VCs. “While direct channels may involve higher initial operational effort, they can improve margins and give restaurants greater control over pricing and customer relationships. If a significant number of restaurants pivot in this direction, aggregators may face pressure to revisit their pricing models and discount policies, potentially reshaping the food delivery market over the next few years,” she added.
As things stand, the food delivery ecosystem doesn’t reward any participant strongly—restaurants are surviving on thin margins, customers end up paying much more, and platforms try to make a slim profit while betting on future scale. Something’s got to give.
