Protesting the alleged unfair practices by Foodpanda, All Pakistan Restaurant Association (APRA) Monday announced to suspend food delivery through the mobile food delivery marketplace in Karachi.
In a letter of complaint to the CEO Foodpanda, Chairman APRA Muhammad Naeem Siddiqui apprised members’ grievances and concerns, pointing out that Foodpanda repeatedly pressed for increase in commission and made some important demands. The letter warned if unfair practices do not stop then APRA would consider to stop working with the company on a permanent basis.
“Vendor delivery is the original concept of Foodpanda and its own delivery was launched as an optional service. Forcing restaurants to close their vendor delivery – which will only increase unemployment but will also disconnect the food outlets with customers – is not acceptable at all. Vendor delivery to remain operational regardless of the size of the brand,” said the letter.
The APRA chairman said that the majority of members are being pressurized to increase commissions but it is impossible to pay 25-35 percent commissions for aggregation services. It is especially difficult for new entrants, as their startup costs get drastically higher. “We need to ensure that there is a cap on commission that Foodpanda may charge,” said Siddiqui.
“Foodpanda managers blackmail APRA members to increase the commission from 18 percent to 25 percent; otherwise, their brands would be shut from the portal. This is the most unethical way of extorting pressure on any member to accept Foodpanda’s terms & conditions and it needs to be stopped immediately,” Siddiqui said in the letter.
The APRA president said, “Our members have also complained that Foodpanda asks them to work with restaurants exclusively, which falls under anti-competitive business conduct and can be challenged in Competition Commission of Pakistan.”
He said that the restaurant industry is already hit hard by Covid-19 lockdown and now is the time when it needs maximum support from stakeholders. “We did raise similar concerns earlier but there has been no permanent solution from the high-ups, which has led us to announce suspension of services by all our members,” he said.
Siddiqui warned that all APRA members will be closing their tablets from 15th September onwards initially in Karachi and if no resolution is achieved, they will be left with no option but to close the Foodpanda services permanently nationwide.