Zomato Hikes Platform Fee

Zomato Shocks Customers with 25% Hike in Platform Fee

Zomato hikes platform fee by 25% to INR 5 per order, impacting major metropolitan areas like Delhi-NCR, Bengaluru, and Mumbai. Read more about the surprising increase!

Zomato, the popular food delivery giant, has made a bold move by increasing its platform fee by 25% in select markets, now charging customers INR 5 per order compared to the previous INR 4. This decision, labeled as a strategic business move, affects areas like Delhi-NCR, Bengaluru, Mumbai, Hyderabad, and Lucknow. Alongside the fee hike, Zomato has also put a pause on its intercity delivery services, causing a stir among its loyal customers who rely on the convenience of the app for their meals.

The platform fee increase to INR 5 per order has resulted in a 4% jump in Zomato's shares, showcasing the market's reaction to this bold step taken by the company. With Zomato serving a massive 85-90 crore orders annually, the impact of this fee adjustment is expected to ripple through the food delivery ecosystem. Despite facing challenges like tax demands and penalties, Zomato seems determined to boost its revenue streams through such strategic decisions.

In a surprising move, Zomato has suspended its intercity delivery service Intercity Legends along with the platform fee hike, indicating a significant shift in its operational focus. The company's continuous adjustments in platform fees over the past year highlight its quest to enhance profitability and reach better financial milestones, as evidenced by the reported 30% year-on-year increase in adjusted revenue in the recent December quarter.

Zomato's persistent platform fee hikes have not only sparked customer discussions but also garnered investor attention. The company's EBITDA has been positively impacted by these incremental fee changes, reflecting a calculated approach towards revenue generation. As Zomato continues to navigate the competitive food delivery landscape, its strategic moves will be closely watched by industry analysts and stakeholders alike.