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The Indian food delivery market, currently dominated by Swiggy and Zomato, is set to witness a new entrant with Tata Group’s super app, Tata Neu. According to reports, Tata Neu is preparing to launch its food delivery service leveraging the Open Network for Digital Commerce (ONDC).

What is ONDC?

ONDC is a government-backed initiative aimed at creating an open network for e-commerce, allowing buyers and sellers to connect directly without relying on any single platform. This network aims to promote competition and choice for consumers, while also enabling smaller businesses to participate in the digital marketplace.

How will Tata Neu use ONDC?

Instead of building its own delivery infrastructure, Tata Neu will reportedly utilise ONDC to connect with restaurants and logistics providers already registered on the network. This eliminates the need for a dedicated fleet of delivery riders for Tata Neu, potentially reducing operational costs.

Impact on the Market

The entry of Tata Neu into the food delivery space, powered by ONDC, has the potential to:

• Increase competition: This could lead to lower prices and better service for consumers.
• Expand restaurant reach: Smaller restaurants not currently partnered with Swiggy or Zomato could gain access to a wider customer base through ONDC.
• Boost ONDC adoption: The success of Tata Neu’s food delivery service could encourage wider adoption of ONDC by other businesses and platforms.

Challenges Ahead

However, Tata Neu faces several challenges:

• Building user base: Attracting users away from established platforms like Swiggy and Zomato will be a challenge.
• Limited ONDC reach: ONDC is still in its early stages, and its network of restaurants and logistics providers might not be as extensive as existing platforms.
• Ensuring smooth integration: Integrating seamlessly with ONDC and ensuring a user-friendly experience will be crucial for success.

Overall, Tata Neu’s entry into the food delivery market with ONDC represents a significant development. While the company faces challenges, it has the potential to create a more competitive and open ecosystem for food delivery in India and challenge the current market players.

It is important to note that this is an ongoing development, and the exact details of Tata Neu’s food delivery service are yet to be officially announced.