Swiggy Considering A Hike In Delivery Fees On Instamart Platform
Food and grocery delivery company, Swiggy, is looking into ways to raise the delivery fee imposed on customers who place their orders via the firm’s quick commerce segment. Rahul Bothra, Chief Financial Officer (CFO), told analysts post-earnings on Tuesday that the online delivery firm is planning to hike the delivery fee charged to its customers using Instamart to help improve the profit margins of the quick commerce entity. “In the overall delivery fee construct, today there is a certain amount of subsidy that goes into the business, both through the subscription programme (Swiggy One) as well as getting users acquainted (with) this new service. Over time there is expectation to increase the delivery fee,” the executive said. However, he didn’ share any particular timeline for the expected changes to be executed. Currently, delivery is free of charge for Swiggy One users, which is the loyalty programme of the company, reported Moneycontrol. Non members have to pay a dynamic fee for using the service. Swiggy’s main competitor, Zomato’s quick commerce wing, Blinkit also charges a delivery fee on every order and has no loyalty programme for customers. Another player in the segment, Zepto, also waives off the delivery fee for Zepto Pass (loyalty programme) users, but charges a fee from other customers. The executive was addressing queries about firm’s plans to improve its commissions from 15 per cent to 20-22 per cent in the future from Instamart. Bothra added that monetisation by running ads on the app is another way to improve margins in time. Swiggy clocked an adjusted revenue of Rs 513 crore from Instamart in the second quarter in the 2024-25 fiscal year, in comparison to Rs 240 crore during the same period a year earlier. Meanwhile, Blinkit clocked a revenue of Rs 1,156 crore during the July-September quarter in the current fiscal year. Also Read : RBI MPC Meeting: Brokerages Forecast Central Bank To Delay Rate Cuts Until February
Food and grocery delivery company, Swiggy, is looking into ways to raise the delivery fee imposed on customers who place their orders via the firm’s quick commerce segment. Rahul Bothra, Chief Financial Officer (CFO), told analysts post-earnings on Tuesday that the online delivery firm is planning to hike the delivery fee charged to its customers using Instamart to help improve the profit margins of the quick commerce entity.
“In the overall delivery fee construct, today there is a certain amount of subsidy that goes into the business, both through the subscription programme (Swiggy One) as well as getting users acquainted (with) this new service. Over time there is expectation to increase the delivery fee,” the executive said.
However, he didn’ share any particular timeline for the expected changes to be executed. Currently, delivery is free of charge for Swiggy One users, which is the loyalty programme of the company, reported Moneycontrol. Non members have to pay a dynamic fee for using the service.
Swiggy’s main competitor, Zomato’s quick commerce wing, Blinkit also charges a delivery fee on every order and has no loyalty programme for customers.
Another player in the segment, Zepto, also waives off the delivery fee for Zepto Pass (loyalty programme) users, but charges a fee from other customers.
The executive was addressing queries about firm’s plans to improve its commissions from 15 per cent to 20-22 per cent in the future from Instamart. Bothra added that monetisation by running ads on the app is another way to improve margins in time.
Swiggy clocked an adjusted revenue of Rs 513 crore from Instamart in the second quarter in the 2024-25 fiscal year, in comparison to Rs 240 crore during the same period a year earlier. Meanwhile, Blinkit clocked a revenue of Rs 1,156 crore during the July-September quarter in the current fiscal year.
Also Read : RBI MPC Meeting: Brokerages Forecast Central Bank To Delay Rate Cuts Until February
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