SUMMARY
The service will be accessible for restaurants that receive up to 100 orders a month and will not be available for high volume restaurant partners
The daily settlement of the transactions will be based on sales from three days prior, Zomato said
Zomato shares have surged more than 146% on the bourses in the past one year while they gained 8.85% so far in 2024
Foodtech major zomato
on Wednesday (December 10) announced the rollout of a daily payout feature for select restaurants.
The service will be available to restaurants that receive up to 100 orders a month and will not be available for high volume restaurant partners. It is pertinent to note that Zomato currently transfers payouts to its partners on a weekly basis.
The daily settlement of the transactions will be based on sales from three days prior, added the foodtech major.
“… we are thrilled to introduce “daily payouts”, a unique feature that supports our emerging restaurant partners… Our discussions with various restaurant partners highlighted the financial challenges smaller eateries face, using the traditional weekly payout system,” said Zomato in a blog post.
In a statement, the company said that the service will be available for eligible restaurants without any additional fees. Zomato added that the feature will improve cash flow of its partner restaurants and streamline working capital requirements.
The new offering comes at a time when Zomato has been looking to add new restaurants to its kitty amid intense competition from Swiggy. The Delhi NCR-based foodtech major has also been streamlining operations and pushing for efficiencies within its verticals, including Blinkit and Hyperpure.
Just days ago, reports surfaced that Zomato had decided to stall the integration of its quick commerce arm Blinkit with the food delivery app to focus on building super brands. Besides, it has also liquidated its subsidiaries in Jordan, Czech Republic, Portugal, Vietnam and Poland.
Zomato, earlier this year, also hiked platform fees to INR 4 per order in major cities as it looks to spruce up its bottom line. A slew of these factors resulted in the company turning profitable in 2023, as it reported two consecutive quarters of profitability in Q1 FY24 and Q2 FY24.
The turnaround has resulted in the listed foodtech company emerging as an attractive bet for investors. Zomato shares have surged more than 146% in the last one year, while they have jumped 8.85% in 2024 so far.
However, the company has also been embroiled in tax troubles. It received a notice of INR 4.2 Cr for alleged short payment of goods and services tax (GST). In December, Zomato also received an INR 401.7 Cr show cause notice from the Directorate General of GST Intelligence, Pune Zonal Unit over unpaid tax on delivery charges collected from the customers.
While the company reportedly has a cash balance of INR 11,800 Cr to cover the impact of any adverse orders, the regulatory troubles could weigh heavily on it.
Zomato shares closed 0.15% higher at INR 134.65 on the BSE on Wednesday (December 10).
