Zomato, following in the footsteps of its competitor Swiggy, has recently introduced a ‘platform fee’ of Rs 2 on each order.
Regardless of the order value, customers will now be charged this nominal fee. This move comes shortly after Zomato achieved profitability for the first time.
At present, the platform fee is applicable only to select users and has not been implemented on Zomato’s grocery delivery platform, Blickint.
Zomato’s Platform Fee Experiment: A Step Towards Sustaining Operations
A pop-up message on Zomato reads, “This is a small fee to help us pay our bills so that we can keep Zomato running.”
A company spokesperson stated that the platform fee is currently in an experimental phase, and they may or may not extend it to all users in the future.
Swiggy’s Precedent: Charging Rs 2 Platform Fee on Orders
Swiggy had introduced a similar platform fee four months before Zomato’s decision.
The Rs 2 platform fee is applicable on each order for Swiggy users as well.
Nominal Fee, Significant Fund: Impact of Rs 2 on Zomato’s Revenue
Considering Zomato’s average gross order value of approximately Rs 415, the Rs 2 platform fee accounts for a mere 0.5%.
However, this seemingly small amount can collectively generate substantial revenue for the company.
Zomato’s Potential Earnings: Millions of Orders Create Huge Value
JP Morgan’s report revealed that Zomato recorded around 176 million orders in the June quarter, averaging two million orders daily.
With this implementation, the company stands to earn an additional income of approximately Rs 40 lakh per day and Rs 12 crore per month.
Customers Unlikely to Notice Marginal Increase: Analyst’s Perspective
Analysts predict that most customers may not even notice the marginal increase of Rs 2 in their total bill at the time of ordering.
However, due to the massive number of daily orders on Zomato’s platform, this platform fee has the potential to create significant value for the company.