Indian foodtech unicorn Swiggy has hiked its commissions from restaurants in the regions where Swiggy’s services have reached maturity, reported ET. This news comes at a time when the foodtech giant is looking to reduce its burn rates and focusing on monetisation of its online food delivery business.
Furthermore, the report also said that Swiggy has also increased delivery fees charged to the customers. Over the few last months, the delivery fees for orders under ₹98 have been increased to ₹35 in certain regions while the fee is ₹25 for orders above ₹98.
Talking to ET, a source said that Swiggy usually ties up with the restaurants for a period of 11 months and commissions have been seen increasing to 18-23% of the total order value from earlier charges which ranged from 12-18% when the contracts are up for renewal.
While talking to ET, a Swiggy spokesperson denied any unusual hikes in commissions and said that this is nothing but business as usual for such a marketplace.
He further added, “Commissions at Swiggy are not based on the category or market maturity/geography. It is worked upon at an individual restaurant level and is in line with factors like average order value, delivery costs and other costs that are incurred.”
With Swiggy’s losses rising five times over the last fiscal, the startup is looking for sustainable growth in the coming year.
Competing with its rival Zomato, Swiggy continues to burn $30 million every month while Zomato has a lower burn rate at $20 million per month.
Swiggy claims to be a leader in the food delivery market with a 60% market share. Last year, Swiggy expanded its services to 500 cities across India and is looking to target 100 million customers with usage of 15 times every month in the next 10 years.