Zomato Increases Platform Fee to INR 4 per Order in Key Cities
Zomato has hiked its platform fee for food delivery services in key markets from Rs 3 to Rs 4 per order, constituting a 33% increase, effective from January 1. This information is available on the company's app and has been confirmed by sources familiar with the matter. On the eve of New Year's, the Gurugram-based company temporarily raised the fee to as high as Rs 9 per order in select markets. According to CEO Deepinder Goyal's post on the microblogging platform X (formerly Twitter), Zomato experienced an all-time high in orders on December 31, surpassing the total orders received during New Year's Eve from 2015 to 2020 combined.
Zomato initiated a standardized platform fee in August 2023, starting at Rs 2 per order and later escalated to Rs 3 across most major markets. A spokesperson for Zomato commented on the fee hike, stating, "These are strategic decisions made considering various factors", without providing further details. In a similar move, Zomato's Bengaluru-based competitor, Swiggy, introduced a platform fee last year, initially set at Rs 2 per order and later revised to Rs 3. Zomato adds the platform fee in addition to a delivery charge, which is waived for members enrolled in its loyalty program, Zomato Gold. However, the platform fee applies to Zomato Gold members as well.
On the other hand, Zomato's quick-commerce platform Blinkit imposes a handling charge of Rs 2 for each order. In their quarterly results spanning July to September, Zomato attributed the improvement in their take rate (the percentage of revenue generated per order) for food delivery to the implementation of the platform fee. According to a research note by Jefferies in November, Zomato observed an enhanced take rate of 24.1% in the September quarter of fiscal 2024, marking a 28 basis points increase from a year ago and a 32 basis points increase from the previous quarter. The report estimated Zomato's delivery of approximately 190 million orders during the quarter, reflecting a 14% surge compared to the corresponding period last year.
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