How Does Swiggy Make Money? Swiggy Business Model

Swiggy

Swiggy is an online food ordering and delivery service in India, and in this article, we shall see how Swiggy makes money. It was founded in Bangalore in 2014 and planned to expand to 500+ Indian regions by September 2021. It also provides streaming services. Grocery deliveries under Instamart and an instant package delivery service called Swiggy Genie are available.

Swiggy’s concept of connecting nearby foodies with local eateries gave the business the advantage of being an early adopter. However, the brand’s growth depends on eateries and local delivery employees. To keep the business running, the firm must provide rebates to local delivery guys. Swiggy charges restaurants a 15–25% fee on the entire order amount (including goods and services tax).

The percentage of the revenue generated by the commission is determined by several factors, including the number of orders, the exact location of the eating facility, the commission paid by competitors, and so on. Swiggy employs cutting-edge technology and processes to meet the market’s expanding need for foodies.

Swiggy is undoubtedly one of the most remarkable instances of addressing restaurant industry trends while meeting consumers’ requests smoothly and effectively. Effectively runs on an alternate partnership approach, which has proven more profitable for retail businesses. And restaurants that choose to provide eating establishments through the platform.

How Does Swiggy Make Money? Swiggy’s Business Plan

swiggy's business plan

The partners are split up into two categories:

Restaurant Partners

Restaurant partners opt to deliver to Swiggy app or website users.

Delivery Partners is Swiggy’s partner restaurant

They make up the courier fleet, responsible for gathering the purchased product from the participating eatery and bringing it to the end customer.

Swiggy’s Revenue Stream

There are three primary ways by which Swiggy generates money –

Delivery fees

Swiggy’s source of revenue was from its consumers.

Customers who buy less than Rs. 250 must give a small delivery cost of Rs20 to Rs40.

Swiggy hikes its prices during periods of strong demand or extreme weather.

Fees for services

Swiggy derives a significant portion of its revenue through commissions.

It charges restaurants commissions to produce sales leads and deliver their meals using Swiggy’s fleet.

Promotion

Swiggy generates income through advertising in the following ways:

Swiggy also promotes and displays advertisements for numerous eateries on its app. Restaurants in various regions benefit from increased visibility through banner advertising and pay a fee for the displayed page.

Swiggy’s Partnership

Swiggy’s most significant partners are restaurants and retailers.

Restaurants that use food delivery companies to provide consumers with food on demand might greatly profit from this Swiggy partnership model.

swiggy instamart

Aside from restaurants, Swiggy’s other partners include grocery stores and pharmacies that want to provide the goods and services they provide as Swiggy’s partners.

The firm is discussing with other electronic and pharmaceutical companies such as MedPlus, Medlife, Pharmaceutical Easy, and Myra about forming a collaboration.

Swiggy can collaborate with delivery service companies that can operate as delivery suppliers.

These partners have the option of working full-time or doing freelance work.

Swiggy pays these suppliers Rs 4 during the first 4 kilometers and Rs 6 every km after the first 4 kilometers.

Delivery organizations used to pay Rs 20 more during unseasonal conditions.

They also receive lucrative rewards based on their success.

Visit: Swiggy

Swiggy’s Market

According to the report, the funding halt might further enhance Zomato’s position.

The website Zomato had an overall market share of 55.7% in the six months to June 2022.

Up from 53% the previous year, Swiggy’s market share fell to 44.3% from 47% in the same period.

See Also: Deloitte SWOT Analysis: Advisory and Tax Services Company

Swiggy’s Financial Performance

Swiggy earns money mainly from online platform services provided to businesses that work together.

(which includes restaurant and grocery retailers and delivery providers), advertisement services, the sale of food and traded products,

payments, and various other platform services.

See also, SWOT Analysis of Swiggy 

Revenue from offering platform services increased by 83.3%, reaching Rs 3,444 crore in FY22, compared to Rs 1,879 crore in FY21. In contrast to FY21,

It should have provided a revenue breakdown regarding services in the previous year.

Supermarket and FMCG product sales were the second-greatest income generator during the last fiscal year, with collections increasing 3.9X to Rs 2,036 million in FY22 against Rs 517 crore in FY21.

Swiggy’s net worth is US$ 450 million. And they run their delivery service almost all over India. And they are earning profit from both sides as it is the medium between restaurants and people ordering food.

See also: How Does Uber Eats Make Money? Business Model Explained

FAQs

How does Swiggy generate revenue?

Swiggy earns money by charging delivery fees. Restaurant commissions.

Swiggy is owned by which country?

Swiggy is an e-commerce food purchase and distribution service in India. At first it was started in Bengaluru.

Is Swiggy profitable or losing money?

Swiggy's revenue in FY 22 was Rs 5,704.9 crore, whereas Zomato's revenue at the same time was Rs 4,687.3 crore. Swiggy's losses in FY 22 are, however, three times larger than Zomato's liabilities in the same timeframe.

How much profit does Swiggy make on every order?

According to some estimations, Zomato and Swiggy get a fee of 10–25% on each order.

Conclusion

Swiggy is on a never-ending journey of making money and profits. The company began by delivering meals to one location and has expanded throughout India.

Furthermore, the food delivery behemoth is broadening its logistics operation with emergency products such as groceries and stationery. Walking a similar road necessitates ongoing development and fortitude in hardship.

Read also: UPS SWOT Analysis: How They Dominate the Courier Industry?