Zomato revenues up 3x, gold plan sees growth

Online food delivery and restaurant discovery platform Zomato said its revenue grew by 225% to $205 million (Rs 1,459 crore), while managing to reduce its burn rate by about 40% in the first six months of the current financial year, compared to the same period last year.

Zomato, which is in middle of raising $400-500 million from new and existing investors, clocked 214 million orders worth $821 million during the period ending in September 2019.

The 11-year-old startup did not disclose absolute numbers on its profit or losses in this report. At the end of March 2019, the company had said it cut its losses for each delivery by over 40% at Rs 25.

“We achieved tremendous results in optimising our costs, without affecting new product launches or innovation,” Zomato said in the half-yearly report. So far in 2019, Zomato has fired 600 from its customer support team. To go back to the financial year ending March 2019, Zomato’s overall cost had swelled by over six times to $500 million, largely attributed to the food delivery business.

While the company faced several weeks of protests from restaurant partners over its Gold programme — which now has been extended for delivery orders — the Gurgaon-based company said active restaurants on Gold has increased to 6,300 compared to 6,100 when the #logout campaign was started by National Restaurants Association of India (NRAI) in August.

Zomato Gold’s subscriber base has increased by 180% to 1.4 million globally. While Gold for delivery was launched here on September 21, Zomato has added 10,000 restaurants under the delivery vertical. Following the protests, Zomato tweaked the Gold programme, for example limiting the usage to once per day.

Interestingly, Zomato’s average monthly transacting users grew by over 200% at 11.2 million users with an average monthly frequency of 3.6 orders a month. This is of significance, given it is facing a fierce fight from Bengaluru-based rival Swiggy. In the last six months, the company has increased its reach to 500 cities compared to 200 cities in April this year.

Zomato’s volumes in the top 15 cities have doubled in the last 12 months, while the remaining cities already contribute 35% to the total order volumes. It has over 2 lakh (jump of 308%) active monthly delivery partners along with 1.19 lakh (jump of 177%) active restaurants on its platform in the period under review. It cut incentives per delivery last month resulting in protests by delivery executives in Mumbai and Bengaluru.

“The number of restaurant listings globally on Zomato has grown from 1.2 million in September 2018 to 1.5 million in September 2019. Half of this increase comes from India alone,” the company added.

Source:- https://retail.economictimes.indiatimes.com/news/food-entertainment/food-services/zomato-revenues-up-3x-gold-plan-sees-growth/71402496