Food tech and grocery delivery major #Swiggy is looking at ways to increase the delivery fee charged to customers who place orders on Instamart, the company's quick commerce arm, to improve the unit’s profit profile, chief financial officer (CFO) Rahul Bothra told analysts on December 3.

“In the overall delivery fee construct, today there is a certain amount of subsidy that goes into the business, both through the subscription programme (Swiggy One) as well as getting users acquainted (with) this new service. Over time there is expectation to increase the delivery fee,” Bothra told analysts after announcing the company’s quarterly results. He, however, did not provide any specific timelines for when the change is coming.

To be sure, delivery is free only for Swiggy One (loyalty programme) users and the others have to pay a dynamic fee. Market leader Blinkit, owned by Zomato, collects a delivery fee on every order and does not have a loyalty programme. Zepto, another key player in the space, also waives off the delivery fee for Zepto Pass (loyalty programme) users but collects a fee from the others, similar to what Swiggy Instamart does.

Bothra was addressing queries around how the company plans to improve its take rates, or commissions, from around 15 percent currently to 20-22 percent in the future, from the Instamart business. Bothra added that monetisation by running ads on the platform is another way margins will improve over time for Instamart.

Instamart is one of Swiggy’s most important divisions and had an adjusted revenue of Rs 513 crore in Q2FY25, up from Rs 240 crore during the same period last year. That compares with Blinkit's revenue of Rs 1,156 crore, indicating that Swiggy has to make up ground.

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