As we all know, Swiggy and Zomato are the leading players in the food delivery industry in India. However, there is a new player in the market that is gaining popularity in recent days - ONDC (Open Network for Digital Commerce), initiated by the Ministry of Commerce and Industry, Government of India. ONDC is a company ( Incorporated under Section 8) that acts as an aggregator for all products and services, allowing consumers to order food, buy clothes, book cabs, purchase movie tickets, groceries and electronics, all with just one click.
ONDC was established in late 2021 by the Department for Promotion of Industry and Internal Trade (DPIIT) as part of the Digital India initiative. ONDC operates as a network of interconnected e-Marketplaces via which sellers and brands can list and sell their products directly to customers.
According to reports, ONDC was founded in December 2021 and offers clients the ability to order meals, groceries, clothing, cabs, movie tickets, gadgets, and other supplies. In contrast to Swiggy and Zomato, it significantly reduces the middlemen between the business and the customer.
Unlike Swiggy and Zomato, ONDC is not an app that can be downloaded from the Play Store. Instead, it can be accessed through Paytm, Magicpin, Meesho, etc. ONDC serves as a storefront for businesses that list themselves on the platform, making their services accessible to customers across the country. When customers order food through ONDC, it is delivered directly by the restaurant without the involvement of third-party apps like Swiggy and Zomato, acting as a cost-cutting measure. However, unlike Swiggy and Zomato, ONDC does not provide delivery executives, and the restaurant owner has to send their delivery person to deliver the food. Moreover, ONDC does not provide the estimated time of delivery, which could pose a challenge also when restaurants receive too many orders there can be instability by the restaurant to fulfil the orders.
ONDC has disrupted the food delivery segment as on ONDC it allows the restaurants to sell food directly to consumers through buyers app. It also charges less than half of the commission charged by the major players Swiggy and Zomato Which Ranges between 18% to 25% enabling the restaurants and food chains to better price their products.
What makes ONDC different from Swiggy and Zomato is they don’t directly charge the delivery fees from consumers whereas when it comes to ONDC it does not charge delivery fees from the consumers currently.
According to the Platforms website ONDC is currently optional in 236 cities including Mumbai Pune Bangalore Noida Kolkata and Chennai it also claims that it has boarded over 29000 sellers Who sell more than 36 lakhs products on the platform.
This ONDC is certainly not a different application, it tends to be open through numerous applications like Paytm, PhonePe, meesho, Magicpin and Mystore. According to a recent report by the American consulting firm McKinsey, ONDC has the potential to increase India's digital consumption by five times to approximately 340 billion dollars by 2030. Some of the seller's apps that are currently available on this network include Alpino, Bitlsila, Bizom BoAt, Delhivery, and Digiit. Additionally, during the same time period, the number of digitally transacting customers increased by three to four times, from 169 to 190 million to 450 to 500 million uses.
Therefore, ONDC is expected to increase India's digital consumption to 340 billion dollars by 2030, with 500 million transacting users. It also has a huge potential to connect 80 to 90 million self-employed workers, and it will unquestionably bring 6 to 7 times more MSME into the divorce ecosystem. It will also play a crucial role in increasing the net income of farmers by 25 to 35 percent and managing the agriculture ecosystem.
Recently, Mint Publication compared the pricing of a food item, the "Big Tandoori Paneer Burger," on these three competitors . While it was priced at ₹359 on Swiggy and Zomato, it costs only ₹270 on ONDC, which is nearly 25% lower than the prices of Swiggy and Zomato. This makes ONDC a better option for those who want to save costs while ordering food.
Currently, ONDC is live in multiple cities across India after completing a successful pilot run in Bengaluru across 16 locations. Since its launch in April 2021, ONDC has received over 11,100 retail orders, making it the highest among all other similar services. It offers menu items from major food chains like McDonalds, Taco Bell, Behrouz Biryani, Wow Momo, Pizza Hut, and Cafe Coffee Day, and these exclusive brands are available at discounted rates ranging from 30% to 80%.
It has the potential to compete with other e-commerce giants like Flipkart and Amazon by offering a diverse range of products and services, making it an all-in-one platform for consumers.
In conclusion, while Swiggy and Zomato have revolutionised the food delivery industry in India, ONDC is emerging as a serious contender in this market, with its cost-cutting measures and a wide range of products and services. As more people become aware of this new player, we can expect ONDC to grow and challenge the established players in the industry.
Top 10 Food Business Ideas in India
P2P Lending: The Future of Borrowing and Investing