Small cities boost Zomato’s growth; likely to add 200 million customers from non-metros, says CEO

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Published: October 22, 2019 4:14:05 PM

Zomato is also likely to see around 200 million customers from India order from its platform “over the next few years”.

Zomato has been focusing on setting up cloud kitchens to boost its food delivery business.

Food delivery and restaurant discovery platform Zomato, which has been facing allegations of deep discounting, unfair business practices etc by restaurant body NRAI, is eyeing further growth from India’s small cities including Tier-II cities and beyond. Zomato CEO Deepinder Goyal in a blog post said that the 35 per cent of the company’s monthly order volume now comes from Tier III and Tier IV cities growing at a ‘frenetic pace’. Zomato currently delivers 1.3 million orders a day from 1.5 lakh restaurants across India at over 10 orders per restaurant per day.

Zomato has been focusing on setting up cloud kitchens to boost its food delivery business. “We are committed to developing cloud kitchens across these geographies to bridge the supply gap,” Goyal said. Zomato is also likely to see around 200 million customers from India order from its platform “over the next few years”. These 200 million will order around five times a month while the top 20 million of these customers would be daily ordering more than one time.

Also read: Why automating logistics, supply chain is must for SMEs to cut cost, boost efficiency

Ever since Zomato became the centre of controversy for its dining-out programme that led to the logout movement launched by NRAI, Goyal has repeatedly claimed no unfair treatment with the restaurant partners and that the company is focused to help them grow. However, NRAI had refuted Zomato’s comments and offer to tweak it Gold programme and instead had last week brought together other food industry associations including FHRAI, others to grow the logout campaign.

The association claiming of Zomato competing with restaurants stressed that “their (Zomato and other food aggregators) role is to merely aggregate services of the Industry; they don’t represent the Hotel and Food Service Industry. Therefore, they cannot decide or dictate commercial terms to and on behalf of the Industry,” Gurbaxish Singh Kohli, President, Hotel and Restaurant Association of India (HRAWI) & Vice President, FHRAI had said in a statement.

Goyal, however, has again denied any competition with restaurants. “I want to re-emphasise that we will never compete with our restaurateur partners – we will only build the kitchens – but they will be operated by restaurant brands.”

Zomato’s cloud kitchens are currently based in 50 cities in India with 110 kitchen hubs (completed or under construction). Overall, there are 663 kitchen units and kiosks.

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