Zomato to charge zero commission from restaurants for takeaway service

Takeaway on Zomato app has witnessed tremendous growth with the order volume increasing by more than 200% in the last few months

Food delivery giant Zomato said its takeaway service is now available to restaurants at zero commission. The Gurugram-based foodtech unicorn is taking this step to help the restaurant ecosystem get back on its feet quickly and reach more customers.

For restaurants that already serve delivery orders, takeaway provides yet another avenue to access more customers, and further expand their business. In fact, takeaway on Zomato app has witnessed tremendous growth, with the order volume increasing more than 200 per cent in the past few months.

“For restaurants to be able to tap into this demand immediately, we are making our takeaway service available for free to our restaurant partners,” said Rahul Ganjoo, vice-president and head of product management at Zomato on the company’s blog, adding, “We will not be charging any commission, and will also forego the payment gateway charges we incur on all takeaway orders.”

There are still millions of customers who haven’t yet ordered since the beginning of the lockdown.  “We believe a lot of them who are bored with home-cooked food will start consuming restaurant food with a safe and convenient takeaway option,” said Ganjoo.

Zomato, which competes with Tencent-backed Swiggy, is already live, with over 55,000 restaurants on takeaway across the country and are serving tens of thousands of such orders weekly. The firm, backed by investors such as Alibaba’s Ant Financial, has been focusing on finding more ways to safely serve customers, while responsibly helping its restaurant partners grow. One common solution that ticked all the right boxes was the option for customers to pick up their own orders.

The food ordering business is making a strong comeback after the initial setback of the ongoing pandemic. As of today, Zomato is at about 110 per cent of pre-Covid gross merchandise value run rate in its food delivery business.

World Health Organization has said that food delivery is safe and people should not fear food packaging. Zomato has delivered over 130 million orders since the first lockdown started in March. It said there have been zero reported cases of Covid transmission through food or its packaging.

Zomato said while the above signs have been more than encouraging, this growth has not been uniform. Also, the overall food service industry is still far from full recovery. The sector will continue to need all the help to get back to pre-Covid levels.

The Covid-19 pandemic has accelerated Zomato’s journey to profitability. The Deepinder Goyal-led firm is on a fund-raising spree as the company is preparing for a public listing next year, focusing on profitability and new business segments.

Info Edge (India), which is an existing shareholder in Zomato, recently said that the food delivery aggregator has raised $195 million (about Rs 1,455.4 crore) in funding from six investors, including Luxor, Kora, and Steadview, valuing the online food ordering platform at $3.6 billion.

In September, Info Edge had informed the stock exchanges about the company raising $160 million (about Rs 1,173 crore) in funding from Tiger Global and Temasek Holdings subsidiary MacRitchie Investments. This had valued Zomato at $3.3 billion.