Zepto Adds Platform Fees To Cart In Push For Profits

Hyperlocal delivery platform Zepto has reportedly introduced a platform fee of ₹2 per order, a first for the quick-commerce sector. This move, while innovative, is relatively uncommon in sectors like e-commerce and food delivery, typically seen in more established markets.

What Happened: The platform fee is just one of the additional charges Zepto is introducing, Moneycontrol reported. The firm is also implementing a ₹15 “late-night handling fee” for orders placed after 11 p.m. in certain scenarios.

Moreover, Zepto has revised its delivery fee structure, discontinuing free deliveries for select users and now charging between ₹5 and ₹28 based on the order value. This strategic shift aims to bolster profitability, with Zepto targeting EBITDA positivity by May 2024.

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In contrast, competitors like Blinkit and Swiggy Instamart, both rivals of Zepto, currently refrain from imposing such a fee on grocery orders. However, they do apply a platform fee for food delivery orders, with some considering raising this fee further, especially during peak hours, to capitalise on heightened demand.

While competitors like Blinkit and Swiggy Instamart are also reportedly exploring nominal delivery fees in specific regions, Zepto stands out as the only major player solely dedicated to quick-commerce. Analysts suggest that Zepto’s aggressive market expansion and competitive pricing strategy reflect its ambition to capture market share despite increased costs.

With its premium Zepto Pass gaining traction and the company’s proactive approach to revenue diversification, including the development of in-house brands like Relish, Zepto is positioning itself for further growth in the quick-commerce segment.

Analysts believe the incremental fees introduced by Zepto are unlikely to deter purchases immediately, with their impact dependent on consumer response as fees evolve.

Other online platforms like food delivery service Zomato have also recently introduced fatter platform fees in the chase for profitability.

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