Food delivery platform Swiggy is collaborating with select restaurants, including Berco’s Restaurant, Impresario Group, Bar Stock Exchange and Gilly’s, to create exclusive delivery-only brands on its platform, a top executive told ET.
As a part of the agreement, Swiggy will share with these restaurants data on supply gaps, work with them on menu options, packaging and pricing, and eventually co-promote the brands on its platform in exchange for exclusivity, a variable consulting commission and delivery fee. Swiggy charges consulting commission between 5% and 8%, according to industry executives.
“We work closely with these top restaurants and take joint accountability for the success of a brand launched under this programme,” Vishal Bhatia, CEO, New Supply, Swiggy, told ET.
These brands operate out of the restaurant partners’ existing dine-in facilities and the brand ownership remains with the restaurant.
“This initiative generates roughly 15% additional revenue for us from an existing kitchen facility,” said Kabir Advani, managing partner, Berco’s Restaurant, which runs House of Chow virtual brand on the platform.
The collaboration pact comes even as restaurant partners complain that Swiggy’s own private labels give it an unfair advantage over their operations. It is also considered one of the avenues for the company to scale its revenue without asset-heavy investment.
Swiggy has 100 such brands on its platform that were co-created with 95 restaurant partners across 13 cities. The company plans to scale this to at least 300 brands by the end of the year.
“Our kitchens at the dine-in restaurants are fully equipped and are run by experienced chefs who are trained in multiple cuisines,” said Gurupreet Singh Bali, managing partner, Gilly’s Restobar, which runs Kitchens of Punjab delivery-only brand on the platform, and one of Swiggy’s first pilot customers. “We realised that growth could come out of negligible additional investment leading to better utilisation of our existing resources through delivery,” he said.
As food delivery scales, building supply of delivery-only brands is critical to offering choice at all price points and cuisines. Swiggy has aimed at solving this supply gap issue with a bunch of initiatives, including developing infrastructure for delivery-only brands to operate with a lower capital investment, introducing private label brands, as well as co-launching brands.
“While Swiggy Access facilitates the expansion of restaurant brands across locations, BrandWorks helps restaurant partners expand their brand portfolio using existing kitchen space and culinary abilities,” Bhatia said.
The larger restaurant ecosystem has also been closely working with Swiggy and Zomato to build delivery-only brands at the right price point, ET had earlier reported. Some of the delivery-only brands include Impresario’s Boss Burger, Hung-Li and Del Italia, Azure Hospitality-incubated Rollmaal and Speedy Chow, deGustibus’ Neel ki Biryani, Indigo Burger Project and the soon-to-be-launched Mandarin Monkey, along with The Olive Group’s Olive Pizzeria.
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