Blinkit, Zomato's Grocery Delivery Segment Resumes Operations

Blinkit, Zomato's grocery delivery segment has resumed operations after a clarification from the company on media report of strike of delivery partners. Blinkit, formerly known as Grofers India, was acquired last year by Zomato.

Recently the operations of the platform were affected by the strike of delivery partners who were protesting against reduction in payouts per order. "We had to shut down some stores for a few days to ensure safety of our employees at stores and the delivery partners. Most of these stores have now resumed operations," Zomato said in a regulatory filing on Wednesday.

According to the filing, the company undergoing changes in the payout structure but did not mention the reduction details. "Over the last few days we have made changes in the delivery partner payout structure with respect to the Blinkit business to address the needs of delivery partners, improve customer experience and reduce cancellation/ order rejection frauds by few delivery partners in the system. Such changes are done from time to time, as needed."

However, according to reports it has come down to Rs 15 per order with a distance based fee component, down from a peak of Rs 50 per order last year which was further reduced to Rs 25.

According to the filing, on April 17, India Today had published an article titled, "Blinkit 'temporarily unavailable' after delivery partners protest change in pay structure". In the article, it was pointed out that the company had made changes in the payment structure of delivery partners of the company's grocery unit, Blinkit which was not a welcome move and was being protested.

"Delivery partners from Blinkit, the grocery unit of food delivery giant Zomato, are on strike demanding a return of the old payment structure. Blinkit recently changed its payment structure, wherein delivery partners would now receive a minimum fee of Rs 15 per delivery, instead of Rs 25 per delivery", was reported.

Therefore the exchange had sought for clarification on Blinkit's service and replying to it the company released an explanation on April 19.

On the financial impact of the situation at Blinkit, Zomato said, "These disruptions and changes have no material impact on the operations/financial performance of the company (meaningfully less than 1 per cent revenue impact)."

Lastly, the company showed readiness to answer and clarify any further doubts pertaining to the issue. "Hope the above clarifies our stance on the aforementioned news item and addresses the points raised by you in your letter. We remain available to address any further queries that you may have."

After the clarification statement the stock price of Zomato rallied to end at Rs 54.14 per share, on Wednesday, nearly 1.5% above previous day's closing. In last one year the stock has fallen sharply by 32.66% and since its listing in July 2021, the price has plunged by nearly 56.98%.