After Zomato, Ola pilots 10-min food delivery; Swiggy may explore faster deliveries too

After Zomato, Ola pilots 10-min food delivery; Swiggy may explore faster deliveries too


Following Zomato’s announcement last month that it planned to monitor a 10-minute food supply, rival Swiggy and ride-hailing service Ola are following suit.

Ola Dash, the company’s speedy commerce grocery delivery arm, has begun delivering select food items in certain parts of Bengaluru in under 10 minutes. Khichdi, pizza, and buns are the menu’s “freshly made” items, according to Ola.

Swiggy could be experimenting with speedier meal delivery. However, it’s unclear if it’s focusing on 10-minute delivery.

Ola will leverage the services of Mukunda Foods, a food robots business that just received $5 million from Zomato for a 16.66 per cent investment.

Mukunda Foods has customers in top cloud kitchens and independent cafes, and it might help drive Zomato Instant, the company’s 10-minute meal delivery service.

Mukunda Foods’ chief executive officer, Eshwar Vikas, indicated that the company does not have an exclusivity agreement with Zomato and collaborates with all three companies.

The company claims that its equipment can cut the cooking time half for Chinese and Indian dishes.

Swiggy is also in talks with Mukunda Foods to employ its smart robotics to automate food preparation in its cloud kitchens for a few of its private brands, according to Vikas.

According to insiders, Zomato has already opened up shop in Gurugram, where it will make 10-minute food delivery to a select group of consumers.

However, a spokeswoman for the company claimed that it has not yet gone live but that it will do so soon.

Mukunda Foods has ordered several machines for roughly 15-20 “cooking facilities” for Zomato. A machine’s average price is around Rs 1.5 lakh.

Beginning this month, Zomato Instant will be trialled in four locations in Gurugram.
The move, which Chief Minister Deepinder Goyal announced, was criticised for putting pressure on supply partners and causing them to drive dangerously. On the other hand, Goyal rejected this, claiming that Zomato would employ analytics to forecast demand ranges and robotics to deliver food in 10 minutes.

About March 22, Zomato’s 10-minute supply goals.

Ola revealed that it had been testing a 10-minute meal supply for a while.

During the initial wave of fast commerce growth in 2015-16, both Swiggy and Ola tested reduced delivery times for cooked meals.



About Swiggy


Swiggy is an Indian food delivery and ordering website, and it is a Bangalore-based food delivery service that began operations in July of 2014. It is active in 500 Indian cities as of September 2021. Apart from meal delivery, Swiggy offers Instamart, an on-demand grocery delivery service, and Swiggy Genie, an immediate gift delivery service.

Bundl Technologies Private Limited is the company that runs Swiggy.



Sriharsha Majety and Nandan Reddy founded Bundl, an e-commerce platform, in 2013 to assist with courier service and shipping inside India. In order to break into the food delivery business, Bundl was paused and then relaunched. The food delivery sector was in chaos at the time, with noteworthy failures like Foodpanda (later bought by Ola Cabs), TinyOwl (later acquired by Zomato), and Ola Cafe (later shutdown).

Swiggy and its parent holding firm Bundl Technologies were created in 2013 by Majety and Reddy, who had earlier worked for Myntra. The company grew quickly after establishing a specialised distribution network, focusing on logistics, and obtaining resources.

Swiggy Go, a fast pickup/dropoff service, debuted in September of this year. The service is used for many purposes, including document and parcel deliveries to both commercial and retail customers. In April 2020, Swiggy Go was renamed Swiggy Genie.

Swiggy laid off 1100 employees during the COVID-19 epidemic in May 2020.

The firm said in 2021 that it would pay for the vaccines of its delivery partners. In March 2021, Swiggy started a Health Hub in Chennai, Tamil Nadu.

During the COVID-19 pandemic in May 2020, Swiggy laid off 1100 employees. In 2021, the corporation declared that it would pay for its delivery partners’ vaccinations.

Swiggy opened a Health Hub in Chennai, Tamil Nadu, in March 2021.



About Zomato


Zomato, formerly known as FoodieBay, was founded in 2008 and renamed Zomato Media Pvt. Ltd. on January 18, 2010. In 2011, it was expanded to include the Delhi NCR, Mumbai, Bangalore, Chennai, Pune, Ahmedabad, and Hyderabad.

In 2012, it opened offices in the United Arab Emirates, Sri Lanka, Qatar, the United Kingdom, the Philippines, and South Africa, expanding its international reach. In 2013, the company expanded into New Zealand, Turkey, Brazil, and Indonesia, with websites and apps in Turkish, Portuguese, Indonesian, and English. It debuted in Portugal in April 2014, followed by launches in Canada, Lebanon, and Ireland in 2015.

The company purchased Seattle-based food portal Urbanspoon in 2015, allowing it to expand into the United States and Australia.

Zomato’s development in the United States was in direct rivalry with similar services like Yelp and Foursquare.

In 2011, domains were introduced, and Zomato founded a site dedicated to food pornography. In May 2012, it collaborated with Citibank to develop a paper version of the website “Citibank Zomato Restaurant Guide,” however it has since been abandoned.

Zomato Infrastructure Services, a solution to assist restaurants in extending their footprint without incurring any fixed costs, was unveiled in February 2017. Zomato announced in September 2017 that it had “become profitable” in all 24 countries where it operates and a “zero-commission model” for partner restaurants. Because it does not use moderators to monitor and make updates, Zomato stopped accepting updates from its active users at the end of 2017. The app’s new payment functionality has been causing headaches for users.

For the financial year 2016–17, Zomato cut its losses by 34% to 389 crore, down from 590.1 crore the last year. In February 2018, Zomato was designated as a unicorn.

In September 2019, the company laid off almost 10% of its workforce (540 employees) who were responsible for back-end duties like customer service, merchant assistance, and delivery partner support. The firm launched its grocery delivery service, Zomato Market, in 80+ cities in India in April 2020 in response to the rising demand for online groceries due to the COVID-19 outbreak.

Zomato introduced contactless dining in April 2020 to prepare for a post-lockdown world, which eliminates the use of high-touch features like the menu, ordering, and bill payments using bar codes or the app while the staff wears masks.

In May 2020, Zomato let off another 520 employees as a result of the COVID-19 outbreak. Despite the fact that demand for food delivery services from restaurants and takeout has grown, Zomato’s claimed reason for needing cuts is that the coronavirus outbreak would be followed by an economic recession, which will hurt orders.

Zomato received accolades in August 2020 for implementing a menstruation leave policy that allows female employees to take up to 10 days off each year if they are unable to work due to the health implications of their menstrual cycle. The policy covers employees who are transgender.

The company went public on July 23, 2021, with an IPO price range of 72-76 per share.



About Ola


Ola Cabs is an international ridesharing company based in Bangalore, India. Financial services, cloud kitchens, and a used-car marketplace are its other business sectors.

Several venture capitalists, including Softbank, own the company. It expanded into its first overseas market, Australia, in January 2018 and launched in New Zealand in September 2018. Ola commenced operating in the United Kingdom in March of this year.



Ola Cabs paid roughly $12.37 billion (US$160 million) in March 2015 for Bangalore-based cab operator TaxiForSure. Ola users have had access to TFS cabs through the Ola smartphone app since June 2015. Ola bought Geotagg, a trip-planning application firm, for an unknown price later in the year in November.

Ola bought struggling food tech company Foodpanda India in December 2017 in a move to expand beyond cab aggregation to utilise the burgeoning food delivery segment market. Ridlr, a public transportation ticketing service, was Ola’s second acquisition in April 2018. Later in August 2018, Ola invested $100 million in the scooter rental startup Vogo’s Series A round, and again in December.

The Karnataka state transport department banned Ola’s operation licence for six months in March 2019 for violating licencing restrictions and the Karnataka On-Demand Transportation Technology Aggregator Rules, 2016. This was due to Ola operating bike taxi services despite only having a four-wheeler taxi licence. The business described the order as disappointing and said it would work with driving partners to keep operating.

They claimed to be in contact with authorities to resolve the situation.

In the run-up to its launch in London in 2019, more than 10,000 drivers applied both online and offline. Ola debuted its taxi-hailing services in London in February 2020, with over 25,000 drivers enrolled.

In the financial year 2020-21, Ola made its first-ever operational profit of 90 crore (US$12 million).

According to sources, Ola is expected to register for an IPO with the market regulator, the Securities and Exchange Board of India, in August 2021. Ola had earlier planned to go public in March 2021, but the epidemic thwarted their ambitions. At a valuation of $8 billion to $14 billion, the IPO is expected to raise upwards of $1 billion. Ola initiated a restructuring process in October 2021 in preparation for its scheduled IPO.

Ola Electric’s chief operating officer (COO), Gaurav Porwal and chief financial officer (CFO), Swayam Saurabh, quit. This came after the departures of founding partner Pranay Jivrajka in March 2021, co-founder Ankit Jain, chief business officer Sanjay Bhan, and financial services CEO Nitin Gupta, all of whom left in 2020.


Subsidiaries and services

ANI Technologies owns and operates Ola Fleet, Ola Financial Services, Ola Foods, Ola Dash, Ola Cars, and the ride-hailing service Ola Cabs. It holds a 6% investment in Ola Electric, a startup that makes electric scooters, as of September 2019.




Between Swiggy’s hyperlocal and Zomato food focus, who has the edge?

Despite their spectacular rise during pandemic-induced lockdowns, meal delivery companies Swiggy and Zomato have struggled with poor unit economics.

The problem of low average order value (AOV) and high delivery costs was not going away. Therefore food delivery marketplaces had little choice but to diversify into other verticals for profit. These commercial realities pushed the startup behemoths to crucial forks in the road, pushing them to make dramatic measures to reinforce or redefine their businesses’ character.

Swiggy, founded in Bengaluru, has maintained a hyperlocal focus since its beginning. While it dabbled in other sectors from time to time, like private food labels and a marketplace model for grocery delivery, business realities drove it to stick to its fundamental ideals.

As a result, there has been a renewed focus on the “neighbourhood convenience economy,” which is a new term for hyperlocal. Instamart, the company’s quick grocery delivery service, is the driving force behind this strategy.

Swiggy began as an essential-goods delivery business amid the pandemic in 2020, but it quickly saw its value in the convenience economy and expanded. Instamart enabled the Sriharsha Majety-led company to develop supply chain management and just-in-time inventory capabilities by providing a deeper grasp of neighbourhood granularities. And it appears like the wager is paying off.

Swiggy’s revenues of Rs 2,547 crore in FY21 were accounted for by Instamart, which is currently available in 23 cities. According to industry sources, that percentage is now at 25%. Top Swiggy officials speaking on anonymity said the company expects Instamart to outgrow food delivery in the next 18 months.

Swiggy is actively developing dark storefronts around the country with a $700 million investment to grow its quick delivery operation. (A dark store is a micro-fulfilment centre where e-commerce companies keep goods for prompt fulfilment of online orders.)

As it expands its network of dark stores and adds more SKUs (stock-keeping units), the AOVs are sure to rise, helping it enhance profits. With Instamart, the company hopes to achieve an annualised GMV run rate of $1 billion in the following three quarters.

Swiggy has developed two revenue streams with food and grocery, which do not feed off
each other. There’s more, though. Swiggy Genie, the company’s pickup and drop (courier) service, is progressively expanding, as is Supr Daily, a subscription-based daily grocery delivery service, and Meat Stores, a meat delivery vertical. The Prosus-backed startup now distributes meals in 520 places, provides local courier service in 68 cities with Genie, and provides daily needs in six.

Swiggy’s ‘everything delivery’ strategy allows it to minimise discounts throughout its platform and connect all of its riders to a single unit, allowing it to use its delivery fleet better. The company claims to deliver things in under 20 minutes in its core markets.

Riders can fulfil more orders per hour as deliveries become faster and spread throughout the day, allowing the company to cut the incentives offered per delivery without reducing a rider’s earnings. “When customers have multiple reasons to open your app, you’ll see a high open rate. Swiggy is a service that allows you to order food and groceries or send a courier inside the same city. To some extent, this solves the unit economics and rider optimisation problems. “Once you solve hyperlocal logistics, you can easily construct food and groceries, which is what Amazon, Flipkart, and Reliance will all do,” says an anonymous food-tech firm founder.

On the other hand, Zomato has always been a food delivery business. It has remained committed to food throughout its various pivots since its inception in 2008 as a restaurant search and discovery platform, all the way to its IPO in 2021 as a full-stack food services firm. In a recent blog, Zomato’s Founder and CEO Deepinder Goyal stated, “Our mission continues to be the preferred food company in India.”

Zomato has experimented with many products to develop an ecosystem beyond food delivery services, using restaurants as the fulcrum.

Hyperpure, which delivers ingredients and other supplies to restaurants and the recently announced, ambitious 10-minute meal delivery, are examples of the company’s efforts to broaden its food scope. Hyperpure, a supply-chain company, expanded by 168 per cent year over year (YoY) and 40 per cent quarter over quarter (QoQ) to Rs 160 crore in the December quarter. The firm said it served over 27,000 different restaurants across nine cities in the third quarter.

The 10-minute meal delivery service ‘Zomato Instant’ is being tested in Gurugram. Like Swiggy’s dark storefronts, the company is currently establishing a network of ‘finishing stations’ or mini-kitchens close to high-demand client neighbourhoods. Based on demand predictability and hyperlocal tastes, these finishing stations will feature various restaurants’ bestseller products (about 20-30 meals).

Apart from food, Gurugram-based Zomato’s first major venture is grocery delivery, which it failed twice in the last two years. It is now attempting to resurrect that dream.

Zomato is close to completing its $700-800 million acquisition of Blinkit, the SoftBank-backed rapid commerce platform.

Zomato intends to use Blinkit’s years of experience in the grocery market and combine it with its delivery capabilities to join the rapid commerce party without having to develop the capabilities in-house.

A proposed merger would provide numerous synergies, including improved cross-selling between food and grocery products and effective delivery optimisation, in addition to assisting Zomato in improving its top line, which is growing slowly. In the October-December 2021 quarter, revenue increased by only 9% sequentially.

It’s unclear how Zomato plans to integrate Blinkit into the platform. Running two separate platforms for goods and food, on the other hand, isn’t going to help its cause.

It’s a vast undertaking to track data from two different systems and create a single consolidated address for each user to draw actionable insights in real-time. Cross-selling potential is lost when both services are not on the same platform.

On the other side, Swiggy has a unified UI. The organisation has access to granular hyperlocal data gathered and mined for insights from two widely used use cases, including information on a locality’s spending power, a household’s dining preferences, shopping habits, etc.

It assists them in deciding where to open dark storefronts, what products to sell at which pin codes, and what to promote in each micro-market. Swiggy may add more verticals to the app, making it a hyperlocal delivery super app.

Like every other e-commerce industry, Grocery is a long-term bet that requires a sizable investment over a lengthy period of time to gain a huge market share. Zomato has $1.7 billion in cash on its balance sheet, but its risk appetite is lower today than it was a year ago when it was not listed. Still, Swiggy, which has a similar war chest, is likely to grow as much as it can before going public.

In the meanwhile, both corporations are in the red. Swiggy views its delivery fleet as its most valuable asset and works to maximise its utilisation to increase profitability. In contrast, Zomato views its restaurant network as its most valuable asset and builds products around it to get out of the red.

Swiggy appears to be approaching market maturity faster than Zomato’s dedicated, but future food ecosystem strategy, with an ‘anything delivery’ approach, focused on the neighbourhood convenience economy.



Why do Swiggy and Zomato love grocery more than food?

Platforms for food delivery Swiggy and Zomato are investing heavily to make grocery delivery the key growth driver in the future. Swiggy, located in Bengaluru, has pledged $700 million to expand its quick delivery service Instmart, while Zomato is in the midst of acquiring Blinkit, a 10-minute grocery delivery startup (erstwhile Grofers). The lessons learned during the Covid-19 pandemic prompted this crucial strategy adjustment.

Pandemic-induced lockdowns created a never-before-seen opportunity for food delivery platforms. People were cooped up in their homes for months, discretionary spending on food services was at an all-time high, existing eateries rushed in droves to their platforms, and new cloud kitchens sprouted like mushrooms. As a result, average order values (AOVs) reached new highs while order numbers soared. But, improvement in operating margins remained elusive, and the writing on the wall became starkly apparent—pure-play food delivery in India isn’t profitable.

Profitability entails increasing AOV and lowering delivery costs in the food delivery industry. According to a survey by global stock investment platform Stockal, the average order value for food delivery in India is about six times lower than in the US and Europe.

Despite having one of the highest commission rates globally, which may reach up to 30% of the order value, Indian food delivery companies lose money on the bulk of their orders due to high delivery costs and discounts.

The most severe issue is the under-utilisation of riders. Lunch and evening are generally the busiest times for food delivery. The poor usage of riders in the mornings and nights rips a massive hole in unit-level profitability. Customers, restaurants, and riders all compete against one other in Swiggy and Zomato’s marketplace model, making it difficult to incentivise all three. Customers and eateries receive discounts, while riders receive incentives, resulting in a major cash outflow.

“Order values peaked during Covid lockdowns because people bundled orders for other family members,” says one analyst. “Order values peaked during Covid lockdowns because people clubbed orders for other family members. Individual orders are increasing as people return to their offices. Food delivery services are increasing in smaller towns with lower AOVs. According to Abhijit Routray, Engagement Manager at RedSeer, “there will be some correction in AOVs due to these circumstances.”

Furthermore, both firms’ numerous food-related innovations have failed miserably, like cloud kitchens and private labels. Both corporations have reduced their cloud kitchen operations. Meals are based on abilities rather than analytics—running a delivery business and quickly making nice food are two very different things. While Zomato has completely abandoned the market, Swiggy continues to operate Swiggy Access, a plug-and-play kitchen infrastructure vertical in five cities.

Meanwhile, unhappy restaurateurs are increasing their opposition. Restaurants pay 15-30% of their revenue to Indian food delivery platforms, depending on the size and scope of their operation. Restaurants have long opposed Swiggy and Zomato’s commission structure, exclusivity terms, steep discounting, and data masking, led by the National Restaurant Association of India (NRAI). To assist members in developing their own ordering channels, NRAI has partnered with a number of technology solution vendors. Swiggy has been testing a direct order concept with restaurants in Mumbai.

Based on data submitted by NRAI last year, the Competition Commission of India (CCI) initiated an investigation into Swiggy and Zomato’s operations and business strategies for alleged violations of competition norms.

Food as a category has better margins, while grocery’s repetition allows for faster scale economies. According to a report by consulting firm RedSeer, e-grocery will be a $21-25 billion business in 2025, with food delivery accounting for slightly over half of that at $12.8 billion.

The ‘when to order’ plight is one of the most challenging difficulties in the online grocery sector, and the Quick commerce model solves it. Households know what they need and have a shopping budget, so ‘what to order in the grocery store is well defined. The challenging question is when to order because there are no set patterns for shopping and other household necessities. The majority of purchases are haphazard and impulsive. So, for unanticipated demands, swift delivery services efficiently address the ‘when’ element.

“People value convenience and are prepared to pay for it, indicating that the market has matured, which directly transfers into the take-home income of the riders because the more deliveries they do, the more they are rewarded.” In the supermarket industry, gross profitability may be achieved quickly. Grocery will be the cause for any of these players to start making money, not anything else,” said Mohit Gulati, CIO and Managing Partner of ITI Growth Opportunities Fund.

Swiggy and Zomato have realised that pure-play food delivery will not get them to profitability because the market will plateau after a certain point. Winning customer mindshare across numerous products and verticals is the game’s goal. These internet behemoths are putting all their resources into the grocery to compete in this brutal duopoly.



10 Mins Delivery: Ola rebrands grocery business from Ola Store to Ola Dash

According to people familiar with the move, ride-hailing company Ola has rebranded its expedited grocery delivery business Ola Dash to incorporate the element of speed into the name itself.

It was previously known as Ola Store when it was first launched last year.

Ola has set aside Rs 250 crore for its grocery delivery service, which it plans to begin in mid-November, ahead of its $2 billion IPO.

According to one of the individuals described above, the organisation has already expanded its operations across six cities: Delhi, Mumbai, Bangalore, Pune, Hyderabad, and Chennai, and is said to be processing 6,000-8,000 orders every day from over a hundred dark stores.

Ola is attempting to explore for the third time in this part.

The ride-hailing company opened a standalone online grocery store in Bengaluru in July 2015, following the introduction of a food delivery app in March of the same year.

Between 9 a.m. and 11 p.m., the company planned to employ its cabs and drivers to deliver groceries.

It closed both Ola Store and Ola Foods less than nine months later without elaborating.


What’s in the name?

This comes only weeks after competitor Grofers was renamed as Blinkit, implying that the company wants to deliver things in the blink of an eye.

In the grocery industry, the companies fight with younger competition Zepto and Swiggy-owned Instamart, Reliance-backed Dunzo, and Tata-owned BigBasket.

The moniker Ola Dash is similar to the American fast delivery company DoorDash, with a market capitalisation of more than $39.94 billion.

Startups like Jokr, Getir, Gorillas, and others have sprung up all over the world, promising 10-minute delivery in locations ranging from New York to Turkey to London.


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