Plastic ban may leave bitter taste for food delivery

India’s food services delivery business, the fastest-growing segment of the Rs 4-lakh-crore food and beverages industry, faces higher operating costs and the likelihood of disruption as the country considers banning single-use plastic materials from next month.

“We may stop delivery of items temporarily if a sweeping ban is announced on October 2,” said SS Aggarwal, managing director of Bikanervala Foods that operates more than 50 restaurants across India. “We are exploring all possible options, but it takes time to put these in place, and will resume delivery when we find other options.”

Aggarwal said that there must be viable alternatives to the cost-effective material the industry has hitherto used to help drive an eating-out culture, particularly in urban India. Restaurant chains believe that existing alternatives to plastic are more expensive, while aggregators said they are working with research focused startups to provide viable, eco-friendly options to kitchens they have enrolled.

The industry believes Prime Minister Narendra Modi could announce a ban on single use plastic materials on October 2, Mahatma Gandhi’s birth anniversary.

Hit on bottom lines
The curbs will likely cover all packaging materials, including bags, cups, containers and straws.

While 18 states have already banned plastic carry bags, Maharashtra, Tamil Nadu and Madhya Pradesh have also banned single-use plastic cutlery, plates, cups and straws.

Restaurant chains ET spoke with said the lack of affordable alternatives for delivering gravy-based or non-dry foods (such as curries or dairy) could raise delivery costs three or four times. The alternatives being considered are earthen pots and cups, or containers made from thick paper or permissible and reusable expensive plastic.

“Packaging costs will double for deliveries. We will have to take the hit on bottom lines partially, while some of the burden will have to be passed on to the consumer,” said Saurabh Khanijo, managing director of the Kylin chain of restaurants. He said the chain, specializing in Japanese cuisine, was exploring options such as sugarcane fibre-based bagasse containers for delivery.

In the current environment, restaurants can’t pass on additional packaging costs to consumers. About 20,000 units closed last fiscal year after the industry failed to secure input tax credits, even as competition from discounted delivery platforms became more intense.

Aggregators’ support
Swiggy and Zomato said that while the onus is on the restaurant chains to switch to environment-friendly packaging, the aggregators are helping find viable alternatives for their partner-kitchens.

Zomato said that it has been working with research-based startups and firms to introduce quality, eco-friendly packaging for restaurant partners. A Swiggy spokesperson said it has found viable alternatives, including bags, straws and cutlery, which the aggregator has made available to restaurants through its Packaging Assist venture.

“Swiggy is working with multiple design consultants and manufacturers of packaging materials to come up with improved design and recyclability of packaging solutions,” said the spokesperson.

Anjan Chatterjee, managing director of Speciality Restaurants that runs Mainland China and Oh! Calcutta, said: “The October 2 ban looks like a reality; we are doing away with plastic proactively because it is a matter of time.”

He said the company was using biodegradable materials and reusable plastic containers that are “very expensive” compared to ordinary plastic. “We cannot pass on the burden to consumers at this point of time,” Chatterjee said.

Besides costs, there are some practical difficulties in using alternatives such as paper in the food packaging industry.

“Food has texture, wetness and flavour, which need to be protected the way the chefs want. Options such as paper packaging are known to absorb the flavours, while leaf packaging tends to tear during transportation,” said Vijay Habbu, technical advisor to PET industry associations such as the Packaging Association for Clean Environment (PACE). “The government needs to arrive at some sort of a workable solution and define what it is banning because not all plastic is bad.”

According to an estimate by the All India Plastic Manufacturers’ Association (AIPMA), the plastic processing industry includes more than 50,000 units and their estimated annual revenue was Rs 3.5 lakh crore in FY19. Another report by the Central Pollution Control Board said that India generated 26,000 tonnes per day of plastic waste in 2017-18, of which 60% was recycled, while the rest remained uncollected.

Rahul Singh, a member of the managing committee at the National Restaurant Association (NRAI), said the mushrooming of cloud kitchens, many of which do not have appropriate licences, must be closely monitored by the government for plastic use.

“Organised chains will follow the rules, but what about the rampant mushrooming of cloud kitchens? If consumers can’t find their establishments, how will the authorities?” asked Singh, who is also chief executive of The Beer Café.

Source:- https://retail.economictimes.indiatimes.com/news/food-entertainment/food-services/plastic-ban-may-leave-bitter-taste-for-food-delivery/71344708