Food delivery and restaurant discovery company Zomato, on Tuesday, announced the rollout of its Daily Payouts programme for restaurants on its platform, particularly smaller eateries. The initiative enables restaurants for more frequent access to their earnings, helping them address financial challenges faced with the traditional weekly payout mechanism.
“In the competitive world of food delivery, restaurant owners often face countless challenges while growing their businesses and competing with established restaurants. Among the most crucial factors for their success are efficient working capital and a steady cash flow,” the company said in its blog post.
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Zomato said restaurants won’t have to pay additional fees for switching from weekly to daily payouts even as they would have improved cash flow with daily settlement of transactions, based on sales from three days prior. Restaurants can switch between daily and weekly payouts through the ‘payout’ section of their Zomato Restaurant Partner app.
The service is currently available for restaurants with 100 or fewer orders a month. Once the monthly order count reaches 100, restaurants will be moved to weekly payouts.
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Zomato, over the past year, has strengthened its focus categorically on the Indian market, after its international footprint failed to deliver enough growth for the company. Since last year, Zomato exited from multiple markets to cut costs including Vietnam, Poland, Chile, Indonesia, New Zealand, Australia, Portugal, Ireland, Jordan, Slovakia, and the Czech Republic.
The company had reported 47 per cent year-on-year growth to Rs 11,422 crore in gross order value for its B2C business comprising food delivery, quick commerce, and going out for the second quarter of the current fiscal from Rs 7,771 crore during Q2 FY23. The food delivery business, with maximum GOV share, saw 20 per cent growth to Rs 7,980 crore in Q2 FY24 from Rs 6,631 crore during the year-ago period.
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Recently, Zomato had raised its platform fee (from users for food delivery) in key markets to Rs 4 per order, effective January 1, from Rs 3 to improve its margins, en route to better profitability. Importantly, the company had received a show-cause notice of Rs 401.7 crore from the GST authorities for delivery charges collected. The company, however, argued that “it is not liable to pay any tax since the delivery charge is collected by the company on behalf of the delivery partners” and that the “delivery partners had provided the delivery services to the customers and not the company.”
