Zomato makes its takeaway service free for all restaurant partners

In an attempt to support the pandemic-hit restaurant industry, Zomato is waiving off commission charges on its takeaway services. Zomato will also forego the payment gateway charges it incurs 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,” Zomato said in a blog post on Wednesday. Besides, for the restaurants that already serve delivery orders, takeaway provides another avenue to access more customers and add to the business.

“The overall foodservice industry is still far from full recovery. The sector will continue to need all the help to get back to pre-Covid levels,” Zomato said.

Last month, The Federation of Hotel & Restaurant Associations of India (FHRAI) had written to Zomato and Swiggy, seeking a reduction in commission charges on takeaway services. The association had urged them to decrease the commission charges by 5% with retrospective effect from May 2020. The commission rates typically vary anywhere between 18-40% of the order value. The amount depends on different parameters like the size of the order and the type of restaurant.

The dine-in segment that drives the bulk of the revenues for the restaurant industry has been severely hit as the consumers shunned non-essential movements and took to online food ordering. As business shrunk, many restaurants closed outlets to rein in costs and pivoted to a takeaway and delivery led model.

Takeaway on Zomato’s app has witnessed tremendous growth with the order volume increased by more than 200% in the last few months, the company said. The service was first launched by the firm in October 2018.

The food delivery segment has seen a quick turnaround. Delivery volumes in India have reached the pre-Covid peaks and the sector is expected to grow at around 15%-25% month-on-month for the foreseeable future, Zomato had said earlier.

“As of today, we are at nearly 110% of pre-Covid GMV run rate in our food delivery business,” the company said in the blog. At present, over 55,000 restaurants across the country avail of the company’s takeaway services. The food delivery firm claims to be serving tens of thousands of such orders weekly.