Food delivery major Swiggy has started charging ₹2 platform fee on food orders in Bengaluru, Hyderabad, and Chennai. However, this platform fee is not applicable on Swiggy’s grocery delivery service, Instamart.
Interestingly, this platform fee is applicable for Swiggy One users as well. Swiggy One is a paid membership program of food delivery company offering benefits across Swiggy Instamart, food delivery, Dineout and Swiggy Genie. Commenting on this decision to charge platform fee, a Swiggy Spokesperson said, “ The platform fee is a nominal flat fee charged on food orders. This fee helps us operate and improve our platform and enhance app features to deliver a seamless app experience.”
Read: Swiggy tests 1-hour e-commerce delivery in Bengaluru
While the spokesperson did not comment on the number of cities where the platform fee is being piloted, as per businessline research, this platform fee is not yet live in any other metro city beyond Bengaluru, Hyderabad and Chennai. Moneycontrol was the first to report this development.
Interestingly, Swiggy’s competitor Zomato does not charge a platform fee as of now. This development comes at a time when growth rate for food delivery has slowed down as compared to Swiggy’s projections, according to an email sent by Sriharsha Majety (Swiggy CEO) to all employees earlier this year.
Zomato too said in February 2023 that food delivery business has slowed down after Diwali (October) and the growth in key metrics has also been muted. In Q3, Zomato reported a 0.7 perc cent jump sequentially in the gross order value of its food business.
This slowdown in food delivery growth led Swiggy to initiate actions on its indirect costs like infrastructure, office/facilities, etc, along with reducing its overall personnel costs to stay inline with the projections for the future. Swiggy fired 380 employees in January 2023. Since then, Swiggy has also piloted multiple new business verticals like Swiggy Handpicked, a premium grocery delivery service and Maxx, one hour delivery service.