To counter Swiggy, Zomato plans to deliver food

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Kunwar Prithvi Singh Chauhan
Part time journalist, full-time observer. Editor-in-Chief at The Indian Wire. I cover updates related to business and startups.

Zomato, one of the key stakeholders in Indian online food-tech space, is planning to launch its own delivery service. According to the sources close to the development, this is being discussed in order to counter Swiggy and to cover more aspects of food delivery ecosystem. Zomato is currently the biggest for discovery platform.

According to an ET report, in a call to analysts, one of the biggest investors, Info Edge confirmed the move. The news also makes sense because Zomato is in advance talks to acquire Runnr, a startup which caters to hyperlocal delivery segment. The acquisition might give a licence to Zomato to start full-fledged deliveries in nearest future.

In a statement in June 2016, Zomato had clarified that out of the total orders placed on the platform, 80% are delivered by restaurants themselves, whereas, 20% are delivered by its logistics partners. It had also stated that Zomato earns an average of ₹21 on the orders delivered by restaurant and loses ₹9.1 on the orders delivered by its logistics partners. Swiggy has been outnumbering the orders delivered in the recent times, however, Zomato stands clear on its statement which claims that the model adopted by Swiggy is not viable.

Zomato currently serves in 2 segments. Online advertising, which is generating the maximum share of revenue for the food-tech startup, as well as food-delivery. In the financial year ended March 2017, the advertising segment seems to have brought more revenue, whereas, food delivery space grew faster. Zomato is now evaluating the restaurants and areas, where it can fulfil the deliveries on its own.

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