India’s biggest startups are faced with growing resistance from industry bodies

  • Big Indian startups have been in the public eye for many controversies thanks to the concerns raised by various industry bodies.
  • From ban on sales to stopping discounts, industry bodies have picked a fight against startups.
  • Zomato, Oyo, Flipkart and Amazon have all been affected by the same.
Indian startups have a growing problem at home – industry bodies from different sectors are now up in arms against discounts and deals. From Zomato and Oyo to Flipkart and even the global retail giant Amazon is caught in a fight.

Here’s a look at all that’s gone down between industry bodies and startups in just the last month.

Restaurants vs online aggregators

All seemed to be going well between Indian restaurateurs and online aggregators until last month. The National Restaurant Association of India, which has over 500,000 outlets as members, woke up to the many deals presented by the likes of Zomato, Swiggy, EazyDiner, Dineout etc., and said that the excessive discounts offered by the delivery apps are throttling their businesses.

Zomato bore the brunt of the restaurants’ ire – from the logout movement to social media uproar from hoteliers It had also faced protests from its delivery executives, who were not happy with the pay cuts from the aggregator.

The foodtech unicorn paused on its Infinity Dining feature and curtailed the Zomato Gold program but the restaurants remain animus towards the firm.

Despite many attempts to thaw in the frosty relationship there is no resolution yet for Zomato and Swiggy.

Hotel associations against Oyo

Oyo Hotels & Homes in the past few years has grown at a rapid pace to have its signboard up in every big city, and many small towns-- adding up to 270,000 rooms across the country. But in its fast acquisition of buildings and hotels, some traditional hoteliers have raised concerns about ‘illegal practices’.

Oyo is battling legal complaints from a Bengaluru-based hotelier accusing Ritesh Agarwal, the founder, of cheating and breach of trust. A month ago, hoteliers too began boycotting Oyo but the Delhi High Court ruled the case in favour of the $5 billion startup.

The good ol’ e-commerce fight

Indian e-commerce has long been in the eye of public dissent from industry bodies. The likes of Flipkart and Amazon were the first to be hit because of their deep discounting which allows them to acquire customers faster. With the festive season around the corner, Flipkart and Amazon both have massive sales coming up. Flipkart is in fact getting ready with its annual sale – The Big Billion Day Sale.

However, now the Confederation of All India Traders is demanding a ban on these sales. The CAIT is an industry body for over 7 crore traders. The body has alleged that the two e-commerce giants are violating the Foreign Direct Investment rules with their massive ad campaigns. It has also written to Union Minister Piyush Goyal regarding the same.
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