Food Delivery To Cost More As Zomato, Swiggy Hike Platform Fees By 20%

In a bid to boost revenue, Zomato and Swiggy have increased their platform fee by 20 per cent from Rs 5 to Rs 6 per order. This fee hike is in addition to delivery charges, goods and services tax (GST), restaurant fees and other order-related expenses.

This hike is currently being applied in Delhi and Bengaluru, with a plan to extend it to other cities soon. In addition, this fee applies to all food orders, irrespective of customer enrollment in loyalty programmes like ‘Swiggy One’ or ‘Zomato Gold’ offered by both platforms.

Earlier, Swiggy imposed a platform fee of Rs 2 in April last year, following that Zomato also did the same. Two major companies have successfully implemented incremental fee hikes, leveraging customer tolerance for higher costs without sacrificing order volumes. This strategic move demonstrates the companies' ability to balance pricing strategies with customer demand, resulting in increased earnings without compromising sales.

This small price rise is expected to give a Rs 1.25 to Rs 1.5 crore daily revenue boost to these food delivery giants. To boost profitability, food delivery platforms are implementing higher platform fees and advertising income. This move is significant as platforms face challenges in increasing commissions without facing backlash from restaurants.

In Bengaluru, Zomato and Swiggy's quick commerce arms, Blinkit and Instamart, charge handling fees of Rs 4 and Rs 5 per order, respectively. Swiggy and Zomato have introduced platform fees exclusively for their food delivery services, not for their quick commerce ventures.