Shillong, April 29: Food delivery platform Swiggy has started levying a small “platform fee” of Rs 2 per order on each user.
You will be charged the fee regardless of the contents of your basket, thus you can have five things or just one order there and still be charged Rs 2. Your order quantity or the value of your cart won’t cause the fee to change.
Due to a slowdown in the food delivery industry, Swiggy is making this step in an effort to increase income and save costs. The extra fee was first made available to customers in Bengaluru and Hyderabad, but it has not yet been implemented in other significant cities like Mumbai and Delhi. The platform fee is only currently assessed on food orders; it has not yet been applied to quick-commerce or Instamart orders.
Swiggy’s CEO and co-founder, Sriharsha Majety, attributed the platform fee introduction to the slowdown in the delivery business, which has impacted the company’s growth rate.
Given that Swiggy serves more than 15 lakh per day, analysts believe that despite the platform charge appearing little, it might provide a sizeable revenue stream for the company. Additionally, it is anticipated that other regions will soon be charged the fee, which will aid the business in controlling costs.
Zomato, Swiggy’s main competition, has also been impacted by the industry-wide downturn. The trend was evident across the nation, but more so in the top eight cities, according to Akshant Goyal, CFO of Zomato, who made the statement in the company’s October-December quarter results. Zomato hasn’t yet added any platform fees, though.
The addition of the extra charge is anticipated to assist Swiggy in reducing its excessive cash burn compared to Zomato.