Zomato hikes platform fee to ₹10 ahead of festive season

Food delivery giant Zomato has raised its platform fee from ₹7 to ₹10 ahead of the festive season, citing the need to cover operational costs and maintain service quality during the high-demand period. The company notified users of the fee increase via its app, stating, “This fee helps us pay our bills to keep Zomato running.”

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The platform fee was first introduced in August 2023 at ₹2 as part of Zomato's efforts to boost its margins and achieve profitability. Over time, the fee has been gradually increased, reaching ₹4 on January 1, 2024, and temporarily spiking to ₹9 during New Year's Eve.

With Zomato recording an order volume of 64.7 crore in the financial year 2023, even a small hike in the platform fee adds up significantly. The ₹1 increase is expected to generate an additional ₹65 crore for the company annually, contributing to its topline growth.

Despite the increase in fees, Zomato reported a smaller-than-expected rise in profit for the second quarter of 2024. The company's profit margins have been impacted by its investments in expanding "dark stores" to support Blinkit, its quick commerce platform.

As the festive season approaches, Zomato continues to focus on scaling operations while managing profitability amidst increasing demand.