A recent study indicates that using popular food delivery platforms in India results in an extra annual cost of at least ₹12,000 for the average household in major metro and tier-1 cities. The report, titled "Food Delivery Unwrapped: Uncovering Hidden Costs on India’s Aggregator Platforms," was published by Mavericks India, an integrated marketing agency.
As per a statement from the company, these apps incorporate small, seemingly insignificant charges into their pricing structures, which collectively lead to an annual ecosystem expense of ₹9,000-11,000 crores.
The company stated that the report was compiled using data from over 50 restaurants across two cities, Delhi-NCR and Bengaluru, and from three aggregator platforms – Swiggy, Zomato, and Magic Pin. The pricing data from these platforms was compared to the prices on the restaurants' own platforms, taking into account various factors such as the base price of the item, delivery fees, packaging and handling charges, platform-specific fees, and the total GST.
The report highlights how the pricing models of food delivery aggregators incorporate seemingly minor fees that might not immediately impact consumers' wallets but accumulate over time, ultimately "having a significant effect on household budgets."
The study examined pricing data from more than 50 restaurants across platforms like Swiggy, Zomato, and Magic Pin, as well as the restaurants' direct delivery channels as of August 21, 2024. This analysis covered the base price, delivery fees, GST, packaging charges, and other additional surcharges.
The report uncovers that, on average, food delivery aggregators charge a premium of ₹46 per dish compared to orders placed directly through the restaurant's own channels. This difference conservatively amounts to an additional ₹12,000 annually for households in metro cities.
Additionally, aggregators charge ₹2 more for packaging than restaurants, despite using the same packaging. When accumulated, this packaging fee contributes to around ₹400 crores in annual ecosystem revenue, according to the report.
“Incremental differences in fees, such as 150-200% higher delivery charges, are significant, and the cumulative financial implication of that can be substantial for consumers. Where 46% of restaurants don’t charge any delivery fees on their own channels, most of them do indicate it on aggregator platforms,” the release said.