Zomato hikes platform fee to Rs 10 from Rs 7 ahead of festive season to ‘maintain services during festive rush’. “This fee helps us pay our bills to keep Zomato running.”
A notification on the app stated “To maintain services during festive season, it has increased slightly.”
In August last year, Zomato introduced a platform fee of Rs 2 to boost its margins to become profitable. The company subsequently increased the fee to Rs 3 and then again to Rs 4 from 1st January.
What is Platform Fee?
The platform fee charged is an additional cost that customers pay on their orders to cover operational expenses related to the delivery process. This fee varies depending on factors like location and order size, and it’s a common practice among food delivery platforms to support infrastructure and operational costs. The specific amount charged can differ, but it is typically a small percentage or fixed amount added to the total bill, excluding taxes and other delivery charges.
Zomato’s Financials
Zomato had an order value of 64.7 crore in FY2023. A Re 1 hike in its platform fee would mean an additional Rs 65 crore to its topline per annum.
Zomato’s share is trading 1.7% higher at Rs 260.7 per share at 11:15am on Oct 23. Its consolidated net profit rose nearly five times to Rs 176 crore for the quarter which ended on Sept 30.
The company approved a fundraiser of upto Rs 8,500 crore via QIP (Qualified Institutional Placement) to boost its cash balance.
To combat rising competition from rivals like Swiggy & Zepto, Zomato added 152 new ‘Dark stores’ during the quarter. It was the most it ever added in any quarter, which takes the total count to 791 stores.
Zomato’s revenue rose nearly 69% to about Rs 4,800 crore.
