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  • “GAME THEORETIC ANALYSIS OF CONTRACTUAL RELATIONSHIP BETWEEN A FOOD DELIVERY PLATFORM AND RESTAURANTS”
“GAME THEORETIC ANALYSIS OF CONTRACTUAL RELATIONSHIP BETWEEN A FOOD DELIVERY PLATFORM AND RESTAURANTS”

“GAME THEORETIC ANALYSIS OF CONTRACTUAL RELATIONSHIP BETWEEN A FOOD DELIVERY PLATFORM AND RESTAURANTS”

Date21st Sep 2023

Time03:00 PM

Venue DOMS Room No. 104 / Webex link

PAST EVENT

Details

Food delivery platforms (FDP’ s) have attained substantial global acceptance, enjoying widespread recognition and adoption in recent years. With the growing allure of FDP’ s as a means for customers to conveniently order meals online, restaurant proprietors are struggling to sustain their businesses amidst the disruptive effects of this emerging business paradigm. Food delivery platforms increase their revenue by charging the restaurants a commission fee for using their services and in return, helps market the restaurant on their platform in proportion to the commission charged. The National Restaurant Association of India (NRAI) in 2021 has alleged that the food aggregators have charged the restaurants exorbitant commissions to use their online platforms. This study aims to analyze the contract and find mechanisms to optimize utilities of all the agents in the contract. First, this study tries to understand the restaurant’s behaviour when they face competition from other restaurants while in a contract with the food delivery platform by specifically analysing the impact of competition on the optimum commission rate and the optimum marketing index. We observe that the FDP benefits from this competition among restaurants – for, the restaurant tries to obtain a marketing index higher than the competing restaurants by offering a higher commission rate. Secondly, we investigate the circumstances under which it becomes advantageous for FDPs to share their limited logistical resources with other e-commerce platforms, considering their existing business models. This study also explores the effects of logistics service sharing by FDPs on the marketing index and commission rate of affiliated restaurants. Sharing of logistic resources is anticipated to yield advantages for both FDP and the e-commerce platform, as FDP will get additional revenue from the e-commerce platform without necessitating further capital investments. Simultaneously, e-commerce will also experience enhanced service levels in contrast to third-party logistic service providers. Restaurants often opt for higher commission rates in order to uphold the consistent quality of service extended to their customers, as e-commerce platforms will receive a share of the logistic service extended to these restaurants.

Speakers

Mr. SIVARAMA ANANDHA KRISHNAN M, Roll no.MS19D008

DEPARTMENT OF MANAGEMENT STUDIES