Swiggy and Zomato riders zooming through the traffic are a common everyday sight in metro cities such as Mumbai, Bengaluru and Delhi. But when it comes to operations across the country, the food delivery business is slowing down, forcing Swiggy to slash its staff by hundreds and Zomato to exit more than 200 small cities.
In order to shore up revenues and save up on costs, Swiggy will be charging a little extra from its consumers on every order.
Exploring additional ways to save cash
Irrespective of the order size and distance, consumers will now have to pay a Rs 2 platform fee per order, which has already been introduced in Bengaluru and Hyderabad.
Other major markets such as Mumbai and Delhi are still not affected by the additional charge, which is only applicable for food orders, while grocery orders on Instamart are left out.
Citing a slowdown, Swiggy's CEO Sriharsha Majety added that the cash flow, which allows the firm to tackle turbulence ahead, can't be its sole support system, and they need to explore other options.
Small fee, big impact
The negligible platform fee can make a big difference for Swiggy, which delivers 15 lakh orders a day, and can make Rs 30 lakh daily from the additional charge.
Swiggy's revenue at Rs 5,700 crore is higher than rival Zomato's Rs 4,100 crore, but it has also been burning more cash than the latter.
Zomato is also affected by the slowdown affecting the entire food delivery sector, but hasn't announced any additional fee.
