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Quick commerce apps stack up extra fees to curb losses

Economic Times

Economic Times · 3m ago

Quick commerce apps stack up extra fees to curb losses

Indian quick commerce companies are introducing fees like handling and convenience charges to boost revenue amid competition. These fees, ranging from Rs 6 to Rs 30, are in addition to delivery charges. The strategy helps improve unit economics by urging higher average order value (AOV) purchases. Despite rising costs, competition deters firms from raising delivery fees. The market is expected to grow significantly, but users discontent with hidden fees remains.

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Related News

India's Zepto becomes the first quick commerce unicorn to introduce platform fee of Rs 2

IndianStartupNews

IndianStartupNews · 1y ago

India's Zepto becomes the first quick commerce unicorn to introduce platform fee of Rs 2

Indian quick commerce startup Zepto has introduced a platform fee of Rs 2 per order as part of its effort to increase profitability. The company has also ended free deliveries for some users and implemented delivery fees based on order value. These fees, along with handling fees, surge fee, and cart fee, aim to diversify Zepto's revenue streams beyond just delivery fees. Additionally, Zepto has launched a membership program called Zepto Pass, offering unlimited free deliveries for orders above Rs 99. Despite experiencing significant revenue growth in FY23, the company aims to achieve EBITDA profitability and reduce losses.

Flipkart Slows Down 'Minutes' Expansion to Reduce Cash Burn Ahead of IPO

OutlookIndia

OutlookIndia · 5m ago

Flipkart Slows Down 'Minutes' Expansion to Reduce Cash Burn Ahead of IPO

Flipkart is scaling back its ultra-fast delivery service, Minutes, to control financial losses ahead of its anticipated IPO. Originally active in 14 cities, Minutes will now focus on operating in eight major markets, which contribute the majority of quick commerce orders. This strategy aims to curb a monthly cash burn of around $40 million. Flipkart plans to expand its network of dark stores to enhance its service while preparing for a potential $60 billion IPO valuation.

Govt probes ecommerce platforms over cash-on-delivery charges - The Economic Times

Economic Times

Economic Times · 22d ago

Govt probes ecommerce platforms over cash-on-delivery charges - The Economic Times

The government has initiated an investigation into ecommerce platforms accused of charging extra fees for cash-on-delivery orders, a practice viewed as misleading to consumers and a violation of their rights. Consumer affairs minister Pralhad Joshi reported this action, categorizing these charges under "dark patterns," manipulative tactics that influence consumer choices negatively. This investigation follows recent governmental actions to eliminate unfair digital practices, broadening the banned dark patterns list to curb deceptive ecommerce behaviors.

Consumer Affairs Ministry probes Flipkart and Amazon over dark patterns

Entrackr

Entrackr · 22d ago

Consumer Affairs Ministry probes Flipkart and Amazon over dark patterns

Following Flipkart’s Big Billion Days and Amazon’s Great Indian Festival, the Department of Consumer Affairs (DoCA) has stepped up scrutiny of both platforms over alleged “dark patterns,” including extra charges for cash-on-delivery (COD) and hidden handling fees. Union Minister Pralhad Joshi said on Thursday that the ministry has received several complaints regarding additional costs imposed on consumers at checkout, despite advertised discounts. “Charging extra for COD is classified as a dark pattern that misleads and exploits consumers,” said Joshi, adding that a detailed investigation is underway and strict action will be taken against violators. The scrutiny is crucial, as millions of shoppers flocked to Flipkart and Amazon’s annual festive sale, often billed as the largest online retail events in India. Social media posts highlighted instances where platforms levy “offer handling fees,” “payment handling fees,” and “protect promise fees” on top of the discounted selling price. Such top ups charged by marketplaces effectively eroded the benefits of deals. This isn’t the first time dark patterns have drawn regulator ire. In 2023, the government issued guidelines prohibiting manipulative tactics like drip pricing, false urgency, and disguised ads. However, recent consumer feedback suggests platforms may be skirting these rules through creative fee structures. Besides Flipkart and Amazon, food and quick commerce majors such as Zomato, Swiggy, and Zepto have also faced criticism for tacking on unexplained charges. With festive season sales forming a major chunk of annual GMV for e-commerce firms, the government’s crackdown could have wide-ranging implications on platform margins and consumer trust.

India’s new obsessions: Quick commerce & short drama apps

Inshorts · 6m ago

India’s new obsessions: Quick commerce & short drama apps

Quick commerce in India crossed ₹7,500 crore in FY24, with 68% of metro users ordering at least twice a week. Short drama apps saw 300 million users in 2025, up 40% from 2023. Ad revenues hit ₹2,000 crore in 2024. As delivery platforms and content apps innovate, speed and personalisation are redefining urban India’s digital habits.

Quick commerce firms chase brand ad dollars to boost revenue, margins - The Economic Times

Economic Times

Economic Times · 3m ago

Quick commerce platforms like Swiggy Instamart, Zepto, and Blinkit are urging brands to increase ad spending to enhance high-margin revenues and offset losses. Instamart has introduced tiered onboarding packages that adjust costs against ad expenditures. Zepto requires monthly ad commitments, while Blinkit charges onboarding fees. These strategies, alongside lucrative ad products, reflect a competitive landscape prioritizing profitability. Advertising revenues, with high margins, have become central to these companies' growth and business models.

Swiggy may recover quick commerce share despite widening losses: Morgan Stanley

Economic Times

Economic Times · 4m ago

Swiggy may recover quick commerce share despite widening losses: Morgan Stanley

Morgan Stanley predicts a strong future for Swiggy’s quick commerce despite rising losses and expenditure. Swiggy's quick delivery service, Instamart, saw a 101% increase in gross order value, although adjusted Ebitda losses reached Rs 840 crore. The brokerage revised the quick commerce market's potential to $57 billion by 2030. Swiggy, with significant investments in infrastructure, plans to expand its network of dark stores and capitalize on growth, maintaining its market share amidst increasing competition.

Swiggy’s Litmus Test

Inc42 · 1y ago

Swiggy’s Litmus Test

Swiggy's efforts to diversify its revenue streams on the food delivery side may not be enough for its upcoming $1Bn+ IPO. While Zomato's food delivery platform is profitable and Zepto has seen success in quick commerce, both companies owe some credit to Swiggy for introducing platform fees and starting the quick commerce revolution in the Indian consumer internet market.

Zomato, Swiggy hike platform fee by 20% to Rs 6 per order

Economic Times

Economic Times · 1y ago

Zomato, Swiggy hike platform fee by 20% to Rs 6 per order

Food delivery giants Zomato and Swiggy have raised their platform fees in key markets such as Bengaluru and Delhi. Previously charging Rs 5 per order, the two platforms have increased the fees to Rs 6, a 20% increase. Both companies have been experimenting with higher platform fees to boost their revenues and profits. In addition to platform fees, Zomato and Swiggy also charge handling fees for their quick commerce arms - Blinkit and Swiggy Instamart.

Flipkart marketplace arm revenue grows 21% to Rs 17,907 crore, cuts loss by 41% in FY24

Economic Times

Economic Times · 12m ago

Flipkart marketplace arm revenue grows 21% to Rs 17,907 crore, cuts loss by 41% in FY24

Flipkart Internet, the marketplace arm of Flipkart, has reported a revenue of Rs 17,907.3 crore for the fiscal year 2023-24, marking a 21% YoY growth. The company also managed to reduce its losses by 41% to Rs 2,358 crore. Flipkart Internet's revenue primarily comes from seller commissions, advertising, and other fees for seller services. In the previous fiscal year, the company earned nearly Rs 5,000 crore from advertising, surpassing various marketplace fees. The focus on profitability and organizational restructuring have contributed to the company's growth and reduced operating costs. Meanwhile, Amazon India is preparing to launch its quick commerce services in the country by the first quarter of 2025.

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