Zomato raises platform fee for food delivery orders
Starting January 1, 2024, Zomato has raised its platform fee for food delivery orders from Rs. 3 to Rs. 4 per order in major markets. On New Year's Eve, the company temporarily increased the fee to Rs. 9 per order in some areas due to record-high deliveries. A Zomato spokesperson stated, "These are business calls which we take basis various factors from time to time."
Rival Swiggy also charges platform fee
Zomato's primary rival Swiggy also imposes a platform fee on its food delivery orders. Initially set at Rs. 2, Swiggy later raised the fee to Rs. 3. This platform fee is separate from the delivery charge, which is waived for Zomato Gold loyalty program members who enjoy perks like discounts and free delivery. However, Zomato Gold members still have to pay the platform fee.
Impact of platform fee on Zomato's financials
Zomato credited the introduction of the platform fee for the improvement in its take rate (per order earnings) for food delivery in its July-September quarterly results. According to a Jefferies research note from November, Zomato's take rate in Q2 FY24 was 24.1%, a 28 basis point increase YoY and a 32 basis point improvement from the previous quarter. During this time, the company reported its second consecutive quarterly net profit, with a profit after tax of Rs. 36 crore.
