{"id":494596,"date":"2025-01-12T05:16:45","date_gmt":"2025-01-11T23:46:45","guid":{"rendered":"https:\/\/inc42.com\/?p=494596"},"modified":"2025-01-18T19:31:32","modified_gmt":"2025-01-18T14:01:32","slug":"zomato-swiggy-new-hunger-snacc-bistro-zepto-cafe","status":"publish","type":"post","link":"https:\/\/inc42.com\/features\/zomato-swiggy-new-hunger-snacc-bistro-zepto-cafe\/","title":{"rendered":"Zomato, Swiggy Put Cafe Wars In Overdrive"},"content":{"rendered":"<p>Zomato and Swiggy walk into a bistro, ask to see the menu and the kitchen, have a \u2018Snacc\u2019 or two while taking a peek into the sales register, and simply walk out. That would be the beginning of a joke, <a href=\"https:\/\/inc42.com\/buzz\/nrai-likely-to-move-cci-against-swiggy-zomato-on-10-minute-food-delivery-apps-report\/\">except restaurants aren\u2019t happy<\/a> about being the punch line.<\/p>\n<p>Even though both giants have clarified that Bistro and Snacc, their new food delivery models, are not competing with restaurants, this just masks how they both arrived at these models.<\/p>\n<p>If we have to believe the claims of these two giants, they both launched identical 15-minute food delivery products without relying on the playbooks written by other restaurants that have worked with them over the years. That seems a little too hard to digest, especially as the writing was on the wall already for the past few months.<\/p>\n<p>Whatever said and done, this is the new battlefield for Zomato and Swiggy, as the two companies enter another phase in their longstanding rivalry. We dive into the cafe wars this Sunday, but after a look at the top stories from our newsroom this past week:<\/p>\n<ul>\n<li aria-level=\"1\"><a href=\"https:\/\/inc42.com\/startups\/2024-in-review-the-best-of-inc42s-30-startups-to-watch\/\"><b>The Best Of 30 Startups:<\/b><\/a> We covered 300 startups throughout 2024 in our 30 Startups to Watch series, and to wrap up the year, here\u2019s a look at the best of the best from the past year. See who made the cut<\/li>\n<li aria-level=\"1\"><a href=\"https:\/\/inc42.com\/features\/can-hiroshi-nishijimas-strategy-bring-an-end-to-zoomcars-financial-woes\/\"><b>Zoomcar\u2019s Challenge: <\/b><\/a>Interim CEO &amp; COO Hiroshi Nishijima outlined a three-pronged strategy to address Zoomcar\u2019s woes and improve cashflow and settle debt. Can he script a turnaround?<\/li>\n<li aria-level=\"1\"><a href=\"https:\/\/inc42.com\/features\/whats-in-store-for-indian-fintech-ecosystem-in-2025\/\"><b>Fintech View In 2025:<\/b><\/a> Although the fintech ecosystem jumped plenty of regulatory hurdles over the years, the sector is likely to see lesser compliance related challenges in 2025 thanks to the maturity reached in 2024<\/li>\n<\/ul>\n<h2>The New Face Of Food Delivery<\/h2>\n<p>On the face of it, the 15-minute delivery services seem new and fashionable, but in reality they have been in the making for the past year.<\/p>\n<p>Swiggy and Zepto both launched \u2018cafe\u2019 services in Bengaluru and Mumbai respectively way back in 2023, but neither of these experiments took off in any meaningful manner. It was only after the success of quick commerce models after this point that added more conviction to these models.<\/p>\n<p>Since mid-2024, plans for cafe delivery operations went into overdrive. Here\u2019s a brief look at the chronology:<\/p>\n<ul>\n<li aria-level=\"1\">Swiggy launched 10-15 minute delivery services under the name Bolt in October. But unlike Snacc or Bistro, this utilised existing restaurant partners on Swiggy\u2019s platform<\/li>\n<li aria-level=\"1\">Zepto then announced that it is separating Zepto Cafe from the main app and spinning it off to scale it up away from the quick commerce operations<\/li>\n<li aria-level=\"1\">Zomato followed up with <a href=\"https:\/\/inc42.com\/buzz\/now-zomato-rolls-out-15-minute-food-delivery-service\/\">15-minute food delivery model<\/a> from restaurants in a 2 km radius similar to Bolt<\/li>\n<li aria-level=\"1\">Then Swiggy launched Snacc also selling fast food, beverages and prepared meals from nearby locations<\/li>\n<li aria-level=\"1\">And Zomato-owned Blinkit then did the same with Bistro, similar to both Zepto Cafe and Snacc<\/li>\n<li aria-level=\"1\">Besides this, we saw the launch of individual delivery startups such as Bengaluru-based Swish, and most recently Zing in Gurugram<\/li>\n<li aria-level=\"1\">Moreover, the likes of Magicpin and Ola Consumer have also launched quick food delivery leveraging the Open Network for Digital Commerce<\/li>\n<\/ul>\n<p>This has created a huge groundswell for instant food deliveries and given a new headache for restaurants. Not only do they have to partner with the likes of Zomato and Swiggy, but also compete with them to a certain extent.<\/p>\n<p>Swiggy claims that Bolt contributes 5% to its overall food delivery volumes with availability in over 400 cities. Zepto CEO Aadit Palicha claimed Zepto Cafe order volumes have grown from 30,000 orders per day in December to 50,000 orders in early January.<\/p>\n<p>Blinkit CEO Albinder Dhindsa <a href=\"https:\/\/inc42.com\/buzz\/zomato-wont-launch-private-brands-on-app-to-compete-with-restaurant-partners-blinkit-ceo\/\">clarified<\/a> that parent company Zomato will never launch private brands on the main app to compete with its restaurant partners, which is why the Bistro app is launched by Blinkit and is separate from the Zomato app.<\/p>\n<h2>Restaurants Raise Alarm Again<\/h2>\n<p>But this seems like a thin explanation when one considers that Zomato and Bistro are both under the same roof, and will naturally share plenty of resources and knowledge. If nothing, Bistro will benefit from Zomato\u2019s expertise and talent depth in food delivery.<\/p>\n<p>Dhindsa also claimed that the company won\u2019t be using the Zomato app to market its newly launched<a href=\"https:\/\/inc42.com\/buzz\/now-zomato-rolls-out-15-minute-food-delivery-service\/\"> 10-minute food offering Bistro<\/a>.<\/p>\n<p>The Blinkit CEO was responding to concerns raised by the National Restaurant Association of India (NRAI) in light of the 10-minute delivery models. The group is said to be in the process of approaching the Competition Commission of India (CCI) to seek intervention and prevent the creation of private labels by Zomato and Swiggy.<\/p>\n<p>Dhindsa\u2019s clarification is not likely to soothe these nerves. He further added, \u201cAll the companies innovating with us on Bistro also work with a number of restaurants and our success at Bistro has the potential to add value for the entire food &amp; restaurant ecosystem.\u201d<\/p>\n<p>Just a few days ago, NRAI even requested the government of giving industry status to the food services sector, to ensure fair play for restaurants, delivery partners as well as consumers against potential exploitative practices of foodtech platforms.<\/p>\n<p>The NRAI is no stranger to taking on the two giants and in the past we have seen the group rally against loyalty programmes and deep discounting. The association previously alleged that the food delivery giants engaged in anticompetitive practices such as bundling of services, exorbitant commissions, delayed payment cycle and imposition of one-sided clauses.<\/p>\n<p>Now the group claims that food delivery giants have access to crucial consumer data but do not share this information with restaurant partners, and are leveraging this data to launch new verticals that compete with restaurants.<\/p>\n<h2>Are Zomato, Swiggy Playing It Smart?<\/h2>\n<p>Market analysts question the financial viability of these models, because even quick commerce as it stands today does not have a healthy track record of profitability. And that\u2019s with groceries and essentials.<\/p>\n<p>Zomato and Swiggy are betting that new-to-delivery consumers would prefer Bistro or Snacc as a quick experiment and get habituated to online food ordering and graduate to the core app eventually.<\/p>\n<p>But this journey is fraught with a number of points where the consumer could just drop off and never return. Squeezing more deliveries out of potentially overworked delivery workers is also a major problem.<\/p>\n<p>It might suit these companies from the point of view of unit economics, but gig workers are the backbone of delivery services, and any stress here could have a cascading effect on other delivery operations as well.<\/p>\n<p>What the cafe model does offer is a way to shorten the profitabilty timelines of existing dark stores, particularly in high volume cities. As a standalone business, one foresees problems such as low average order value and low retention of users.<\/p>\n<p>If this weren\u2019t enough the three major quick commerce players \u2014 Zepto, Blinkit and Swiggy Instamart \u2014 have all come under the scanner for their rapid expansion and how this has impacted smaller grocers and retailers in metros and Tier I cities.<\/p>\n<p>We foresee a slew of regulations in 2025 to address this rapid expansion and its impact on the retail FMCG space over the past years. Incidentally, some startups are currently building quick commerce platforms with different models such as a clear retail presence, that might circumvent some of these concerns.<\/p>\n<p>Will the likes of Blinkit, Instamart and Zepto also resort to physical stores in the near future to mitigate the potential regulatory risks?<\/p>\n<h2><b>Sunday Roundup: Tech Stocks, Startup Funding &amp; More<\/b><\/h2>\n<ul>\n<li aria-level=\"1\"><b>Funding Bump: <\/b>Over the past week, Indian startups saw a big uptick in capital infusion more than <a href=\"https:\/\/inc42.com\/buzz\/from-innovaccer-to-beyond-snack-indian-startups-raised-432-mn-this-week\/\">$432 Mn raised by startups<\/a> across 20 deals, led by Innovaccer\u2019s $275 Mn round<\/li>\n<li aria-level=\"1\"><b>upGrad Cofounder Floats New Venture<\/b>: Mayank Kumar has launched a <a href=\"https:\/\/inc42.com\/buzz\/upgrad-cofounder-mayank-kumar-launches-talent-mobility-startup-borderplus\/\">new talent mobility startup, BorderPlus<\/a>. The new startup claims to help employees in India land \u201cnursing\u201d jobs in healthcare facilities in Germany<\/li>\n<\/ul>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-494597\" src=\"https:\/\/inc42.com\/cdn-cgi\/image\/quality=75\/https:\/\/asset.inc42.com\/2025\/01\/Weekly-NL-Swiggy-Zomato-table-scaled.jpg\" alt=\"\" width=\"1018\" height=\"2560\" srcset=\"https:\/\/inc42.com\/cdn-cgi\/image\/quality=75\/https:\/\/asset.inc42.com\/2025\/01\/Weekly-NL-Swiggy-Zomato-table-scaled.jpg 1018w, https:\/\/inc42.com\/cdn-cgi\/image\/quality=75\/https:\/\/asset.inc42.com\/2025\/01\/Weekly-NL-Swiggy-Zomato-table-119x300.jpg 119w, https:\/\/inc42.com\/cdn-cgi\/image\/quality=75\/https:\/\/asset.inc42.com\/2025\/01\/Weekly-NL-Swiggy-Zomato-table-1024x2574.jpg 1024w, https:\/\/inc42.com\/cdn-cgi\/image\/quality=75\/https:\/\/asset.inc42.com\/2025\/01\/Weekly-NL-Swiggy-Zomato-table-611x1536.jpg 611w, https:\/\/inc42.com\/cdn-cgi\/image\/quality=75\/https:\/\/asset.inc42.com\/2025\/01\/Weekly-NL-Swiggy-Zomato-table-600x1508.jpg 600w, https:\/\/inc42.com\/cdn-cgi\/image\/quality=75\/https:\/\/asset.inc42.com\/2025\/01\/Weekly-NL-Swiggy-Zomato-table-150x377.jpg 150w, https:\/\/inc42.com\/cdn-cgi\/image\/quality=75\/https:\/\/asset.inc42.com\/2025\/01\/Weekly-NL-Swiggy-Zomato-table-139x350.jpg 139w, https:\/\/inc42.com\/cdn-cgi\/image\/quality=75\/https:\/\/asset.inc42.com\/2025\/01\/Weekly-NL-Swiggy-Zomato-table-89x225.jpg 89w, https:\/\/inc42.com\/cdn-cgi\/image\/quality=75\/https:\/\/asset.inc42.com\/2025\/01\/Weekly-NL-Swiggy-Zomato-table-30x75.jpg 30w, https:\/\/inc42.com\/cdn-cgi\/image\/quality=75\/https:\/\/asset.inc42.com\/2025\/01\/Weekly-NL-Swiggy-Zomato-table-227x570.jpg 227w\" sizes=\"(max-width: 1018px) 100vw, 1018px\" \/><\/p>\n<ul>\n<li aria-level=\"1\"><b>Ola Electric Vs CCPA:<\/b> The Central Consumer Protection Authority (CCPA) continues to <a href=\"https:\/\/inc42.com\/buzz\/ccpa-again-seeks-additional-info-from-ola-electric\/\">tighten scrutiny around Ola Electric<\/a>, and sought more information in connection with an investigation into the company<\/li>\n<li aria-level=\"1\"><b>Rishen Kapoor Returns To Peak XV: <\/b>Months after the shutdown of his SaaS startup Toplyne, cofounder and CEO Rishen Kapoor <a href=\"https:\/\/inc42.com\/buzz\/after-shutdown-toplyne-cofounder-rishen-kapoor-returns-to-peak-xv\/\">has joined back Peak XV Partners<\/a> to look at early stage deals<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Zomato and Swiggy walk into a bistro, ask to see the menu and the kitchen, have a \u2018Snacc\u2019 or two&hellip;<\/p>\n","protected":false},"author":1081,"featured_media":494599,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"title":"Zomato, Swiggy Put Cafe Wars In 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I love digging into startups and business models. A rare Bombayite who actually likes Delhi. 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