How Chandigarh-Based uEngage Is Liberating F&B Sellers From The High Commission Trap

The rise of online food aggregators such as Swiggy and Zomato has transformed the way we dine. While these platforms have simplified the process of ordering food from restaurants, they have also brought forth a host of challenges for restaurateurs. 

For context, one of the prominent issues faced by restaurant owners is the steep commission charges imposed by food aggregator platforms. Apart from this, restaurateurs are quite vulnerable to untimely hikes in commission charges. 

The reliability of restaurants on foodtech platforms today is concerning. In its 2023 report, brokerage firm JM Financial highlighted that restaurants attribute a significant portion, about one-third, of their revenue to these platforms.  

On top of this, restaurants remain unaware of the individuals they are serving even when a meal is delivered mere steps away. This hinders the ability of local restaurants to personalise services and build customer relationships.

Addressing this issue is uEngage, a seller-side app, which provides online ordering solutions to restaurants, cloud kitchens, grocery stores, and meat/fish sellers and helps them save on aggregator commissions. 

The Shopify Of The Hyperlocal Space?

Launched in 2018 by Sameer Sharma, Chandigarh-based uEngage goes beyond helping restaurant owners save commissions; it is a technology company at its core.

The enterprise tech startup offers three tech solutions to its users, namely Edge, Flash, and Prism. These tools enable restaurants to create custom ordering apps, manage deliveries efficiently and automate marketing efforts. 

However, the crux of uEngage’s philosophy is to rescue local restaurants from the shackles of unfairly high commission charges and absurd fee structures, especially the monopoly of top giants in the food delivery ecosystem.

“Initially, the commissions on Swiggy and Zomato were around 15%, but now it has surged to 28-30% for many merchants. While larger chains like McDonald’s may have negotiating power, smaller restaurants often find themselves at the mercy of these platforms. There seems to be no escape for restaurants because if one aggregator increases its fees, others tend to follow suit,” said Sameer Sharma, founder of uEngage.

Committed to the cause, uEngage operates on a zero-commission model. However, they do charge a transaction fee of 2% plus GST, which covers the payment gateway fee as well.  

“We aim to disrupt the escalating aggregator commission rates, catering to brands like Theobroma, La Pinoz Pizza, Tossin Pizza, Bikanervala India, and Samosa Party. For these brands, we serve as the Shopify of the hyperlocal space.”

Additionally, the startup actively engages with the Open Network for Digital Commerce (ONDC), allowing businesses to integrate with the open digital commerce network.

Currently, uEngage serves restaurants, quick-service restaurants (QSRs), salons and wellness centres, cafes, food courts, grocery stores, cashless campuses, direct-to-consumer (D2C) businesses, breweries, and cloud kitchens.

Interestingly, uEngage is not the only venture Sharma owns. Currently, he spearheads two bootstrapped startups, uEngage and Shoutlo.

His entrepreneurial journey began with the success of his debut startup, Trideal, which was later acquired by Paytm-owned LittleApp in 2015. 

Back to the story, uEngage is the byproduct of Sharma’s vision to revolutionise the foodtech industry. What crafted his vision was a simple disagreement with some common industry practices — unfairly high aggregator commissions and the lack of data sharing between merchants and end customers. 

To tackle these challenges, the startup developed uEngage Edge to enable brands to launch their mobile apps, leveraging the company’s expertise in mobile app development.

What’s In The uEngage Tech Stack

Originally designed as a digital ordering platform catering specifically to restaurants, uEngage has expanded its offerings. 

Under the umbrella of uEngage EDGE, users gain access to a suite of direct ordering features, including mobile apps, SEO-optimised websites, WhatsApp ordering, and Kiosk ordering. uEngage Edge transforms restaurant operations with its technology-driven platform. It offers digital catalogues, QR codes, and multiple payment options. Edge helps restaurants launch their very own online ordering apps and run customer loyalty campaigns. 

Meanwhile, with its uEngage PRISM offering, the startup streamlines marketing campaigns to engage customers effectively. It is a platform designed to enhance marketing strategies and foster customer loyalty across diverse channels. Businesses in need of customer marketing and omnichannel loyalty solutions rely on uEngage PRISM.

The uEngage Flash tool optimises delivery operations with AI-powered solutions and real-time tracking. It specialises in last-mile delivery and tracking, offering functionalities such as self-delivery and seamless integration with third-party logistics providers.

In addition, the startup provides salon management software named uEngage Arc, which streamlines tasks like attendance, appointment booking, and inventory control. 

It offers detailed reports on sales, memberships, and staff productivity, enabling data-driven decisions. Arc serves as a marketing tool, facilitating personalised interactions via emails, SMS, and WhatsApp.

Besides these offerings, the startup joined the ONDC network in July 2022 as a seller app.

Sharma told Inc42 that ONDC serves as an extension of their vision, as it enables orders not just through apps and websites but also via the ONDC platform. This multi-channel strategy ensures orders can be received from diverse sources, offering convenience and flexibility to both businesses and customers.

“ONDC has played a transformative role in our business strategy, particularly in expanding our reach to smaller outlets. Before ONDC, acquiring such outlets was challenging due to high costs. However, in the past 18 months alone, we have expanded from serving 4,000 outlets to 15,000 outlets. This shift has made the long tail of merchants relevant to uEngage, contributing significantly to our overall growth strategy” Sharma added.

Apart from this, the startup works closely with logistics providers like Dunzo, Zomato Xtreme, Shadowfax, Loadshare, and Rapido.  

The Profitability Paradigm & Future Outlook

According to Sharma, uEngage achieved profitability within 18 to 24 months of its inception. 

“The initial 18 months were challenging as we navigated through business model iterations and acquired our first customers,” Sharma said. 

In terms of revenue, the startup recorded INR 5.7 Cr last year. For this fiscal year, it projects revenue between INR 13 Cr and INR 14 Cr. 

Additionally, the startup projects a gross merchandise value (GMV) of approximately INR 310 Cr for its brands. The startup’s partnerships extend to nearly 4,000 outlets for its direct ordering business, covering over 15,000 outlets across all its offerings, including ONDC.

Going forward, the brand is targeting 50,000 outlets within the next 3-4 quarters. Apart from Zomato and Swiggy, uEngage locks horns with Shopify, Dotpe, Reelo, Bitsila in the larger enterprise tech space.

According to a Statista report, the Indian online food delivery market is expected to become a $92.50 Bn market opportunity by 2029, growing at a CAGR of over 16% from $43.78 Bn in 2024.

[Edited by Shishir Parasher]