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Zomato To Shut Down Its Ten-Minute Food Delivery Business: Report

The company reportedly communicated to restaurant partners that it would look to close down the service

Zomato To Shut Down Its Ten-Minute Food Delivery Business: Report

Outlook Start-Up Desk

POSTED ON January 23, 2023 5:57 PM

Zomato is reportedly shutting down its ten-minute food delivery service Zomato Instant less than a year after its launch. The move has come as the company chases profitability amid tough market conditions, Economic Times (ET)reported.

It is said that the company has communicated to its restaurant partners that it would look to close down the service.

“It didn’t look like it would turn profitable. The company was not getting the daily volume required to even pay the fixed costs. It wasn't scaling up to that level,” a person aware of the development told ET.

“The plan is to now pivot to a new product,” he said.

"Zomato is experimenting with low-value packed meals – thalis or combo meals. It has not been decided if Zomato will retain the ten-minute preposition for this. However the new offering will be launched in 7-10 days," the source added.

However, the report suggested that in an official statement, the company said that Zomato was not shutting down Instant but rebranding the service.

"Instant is not shutting down. We are working on a new menu with our partners and rebranding the business. All finishing stations remain intact, and no people are impacted by this decision," the company said.

In March 2022, Zomato launched its ten-minute food delivery offerings. "Nobody in the world has so far delivered hot and fresh food in under 10 minutes at scale, and we were eager to be the first to create this category, globally!" CEO Deepinder Goyal wrote in a blog post at the time of the launch.

The service was offered through Zomato's 'finishing stations', which stocked best-selling dishes from various restaurants based on demand predictability and hyperlocal preferences. The company launched around five such stations, mostly in the National Capital Region, and also recently started the service in Bengaluru.

The development comes soon after the exits of chief executive Mohit Gupta, new initiatives head Rahul Ganjoo and chief technology officer (CTO) Gunjan Patidar. 

Besides Gupta, Ganjoo and Patidar, Siddharth Jhawar, who was serving as vice president and head of Zomato’s Intercity Legends service, had also quit the firm.

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