Zomato stopped service in more than 200 cities

Zomato, which provides food delivery service through the app, has stopped its service in about 225 cities last month. The company has given this information in the December quarter results. Zomato has said that this decision has been taken due to low number of orders in these cities for the last few quarters.

The company has said in a letter sent to shareholders, “There is a slowdown in the food delivery business since October last year. This trend is being seen across the country. Due to this, the growth in Zomato’s GOV in the third quarter was only 0.7 percent.” However, GOV has seen a growth of 21 percent on year-on-year basis.” GOV is the total value of all discounts excluding taxes, customer delivery charges, tips. This value of the company in the December quarter was Rs 6,680 crore.

Earlier this month, Zomato had reported in its results for the October-December period that its consolidated revenue had increased by almost 75 percent to Rs 1,948 crore. However, the company’s loss increased to Rs 346 crore. This includes figures from the company’s units Blinkit and Hyperpure. The company’s adjusted revenue from food delivery grew nearly 30 percent in the December quarter on a year-on-year basis. However, there has been a decline on year-on-year basis.

At the end of last year, last month, e-commerce company Amazon had decided to stop its food delivery in the country. The company was facing tough competition from Swiggy and Zomato in this business. Earlier, Amazon had also closed its edtech unit. The company had informed its restaurant partners to stop this service from December 29. This unit of the company is called Amazon Food. Restaurant partners were assured to complete payments and other contractual obligations by December 29. In the letter sent by the company, it was said that restaurant partners will continue to have access to the company’s tools and reports till the end of January. Amazon Food was started from Bengaluru in the country to compete with Swiggy and Zomato and was later expanded.