Zomato launched food delivery in 2015; it now has presence in 24 countries.
The first thing we check when we order from the food delivery giant is discount offers and if the prices have been slashed by 50%, the discount is borne by the Restaurant 40% and the rest 10% is borne by Zomato.
This is because customers always prefer to order from a Restaurant offering a high discount until they have favorites.
So every month a lot of restaurant’s list themselves on Zomato in a hope to increase their customer base and in turn monthly revenue, so if one restaurant does not offer a discount there is a lot of competition willing to offer the same dish with a rebate.
So what exactly do Restaurant owners earn?
Supposed monthly sale from Zomato: 100000
Zomato commission 25% – 25000
Zomato Ads to come first in listing – 20000 (Minimum Amount)
Discount offers 40% Share – 40000
Packaging cost – 5000
Total: 100000 – (25000 + 20000 + 40000 + 5000) = 10,000
Now see what a restaurant is getting in that 1 Lakh only 10000 which includes Raw Material, operations Cost. Thus a restaurant is bearing loss by offering such high discounts.
Another campaign that is quite popular is Zomato300, which gives the user 30% off up-to Rupees 300 on orders above Rupees 400, The Restaurants have to Contribute 21% to the Discount Code and Zomato pays for only 9% of the code.
Hence; since Zomato is contributing extremely less in these Scheme’s and Discount Code’s, the true loss is actually borne by the Restaurant’s and also the Delivery Chargers that a customer pays are completely owned by Zomato.
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