Food delivery giant Zomato has increased its platform fee from ₹7 to ₹10 in anticipation of the festive rush, citing the need to maintain services during the busy season. The platform fee is an additional charge applied to each food order, aside from the usual restaurant charges, delivery fee, and taxes.
Zomato initially introduced a platform fee of ₹2 in August 2023, gradually increasing it over time to boost its margins and drive profitability. With an order volume of 64.7 crore in FY23, a mere ₹1 hike in the platform fee structure could contribute an additional ₹65 crore to its topline annually.
This move comes as Zomato faces increasing competition in India’s food and grocery delivery sector, with rivals like Swiggy and Zepto aggressively expanding their operations. Zomato has responded by adding 152 new “dark stores” in Q2 FY25 to enhance its quick commerce platform, Blinkit. However, the contribution margin for Blinkit slightly decreased during the quarter, reflecting the temporary cost impact of these new store additions.
Despite the rise in platform fees and competition, Zomato’s consolidated net profit for Q2 FY25 surged nearly five-fold to ₹176 crore. Revenue increased by 69% YoY to ₹4,800 crore. Zomato also approved a fundraise of up to ₹8,500 crore via a qualified institutional placement to strengthen its cash position after acquiring the movie and events ticketing businesses of a digital payments firm.
As of 11:24 am, Zomato shares were trading 2.32% higher at ₹262.30 on NSE.
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