Zomato Platform Fee Hike: According to media reports, Zomato’s main rival Swiggy offered shares valued at $448 million in its initial public offering, while Zepto raised $340 million in August and is expected to list its shares next year.
Zomato Platform Fee Hike: Zomato, a food delivery giant, has increased the platform fee for its users during the festive season. The company has hiked the fee from Rs 7 per order to Rs 10 to keep it running amid festival season sales. The company has taken this move to maintain services during the festive rush and help the platform pay its bills to keep it running.
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What Is Platform Fee?
It is an extra charge added to each food order, on top of GST, restaurant charges, and delivery fees. As competition intensifies in India’s online food and grocery delivery sector, companies are seeking to raise funds to expand their operations and capture a larger market share.
Zomato’s Platform Fee
The company introduced in August 2023 at Rs 2 per order, Zomato’s platform fee was aimed at boosting margins and driving profitability. Over time, the fee increased to Rs 3 and then to Rs 4 by January 1, 2024. On December 31, 2023, the fee was temporarily raised to Rs 9.
With an order volume of 64.7 crore in FY 2023, the latest Re 1 hike is projected to add approximately Rs 65 crore annually to Zomato’s revenue. Meanwhile, its Bengaluru-based rival Swiggy, which was the first to start charging this levy, has also raised the fee over time to Rs 7.
Read More: Zomato profit surges nearly five times in September quarter
Zomato Vs Swiggy Vs Blinkit
According to media reports, Zomato’s main rival Swiggy offered shares valued at $448 million in its initial public offering, while Zepto raised $340 million in August and is expected to list its shares next year.
In response to the growing competition, Zomato expanded by adding 152 new “dark stores”—distribution centers—during the quarter, bringing its total to 791, the highest addition in any quarter.
Despite this, Blinkit’s contribution margin, which measures the revenue from each additional order as a percentage of the gross order value, declined to 3.8% from 4% in the previous quarter.
