Zomato Is In Talks With Restaurants To Deliver Food In 10 Minutes: Report

When Zomato had signed a term sheet to merge with 10-minute grocery delivery startup Blinkit, it had been speculated that Zomato would use Blinkit to enter the grocery delivery space. But it seems that Zomato was eyeing Blinkit’s delivery model instead.

Zomato has held talks with restaurants and cloud kitchens to deliver food in 10 minutes, ET reports. The talks are in the early stages but revolve around 10 minute food deliveries. Zomato is likely to launch a 10-minute food delivery pilot programme from April in a few cities, starting with Gurgaon.

“We have been approached by them (Zomato) to set up a kitchen alongside them … they are setting up these warehouses and giving ‘co-working’ style cooking stations to these brand owners,” a restaurant owner said. “They assume it will succeed only if delivery happens within 15 minutes maximum. They claimed 10 minutes delivery succeeded in the experiment,” said another cloud kitchen operator.

Zomato is exploring multiple models to do deliver food in 10 minutes, including utilising warehouses of its business-to-business supplies business for restaurant partners, called Hyperpure, or leasing out new facilities. It is also exploring models where restaurants could supply select menu items directly.

There are already a bevy of startups that deliver groceries in 10 minutes, including Zepto, Ola Dash, and Blinkit, in which Zomato owns a substantial stake. These startups quickly deliver groceries by creating delivery-only dark stores in high density neighbourhoods. These stores, which are optimized for online deliveries, allow riders to pack orders in a couple of minutes flat, and a delivery fleet then performs the delivery in neighboring areas in 8-10 minutes.

It’s unclear how this model could be replicated for food delivery. The preparation of some dishes can itself take longer than 10 minutes, so it’s likely that Zomato will offer a truncated menu of items that can be sent out for deliveries in a few minutes. Also, Zomato will likely have to lease properties in high-density neighbourhoods to quickly deliver to its urban customers.

While 10-minute deliveries might appeal to customers, questions still remain around the financial viability of the business model that powers them — Grofers had pivoted to Blinkit late 2021 and begun focusing solely on delivering groceries in 10-minutes, but it had been reported last week that the company had shut down 45 of its 500-odd dark stores, laid off hundreds of workers, and was delaying payments to vendors. The cash-strapped firm had approached Zomato for a loan, and Zomato had invested a further $150 million into the company. With Zomato now itself looking to jump headlong into 10-minute deliveries, it’s clear that many startups and entrepreneurs are keen on delivering in 10 minutes — whether these operations manage to become sustainable businesses might be a different matter altogether.