The pay structure for delivery partners has increased 7-8%, and will be adjusted in the future automatically based on the price of fuel.

A Zomato rider sitting on a bike wearing the tshirt and helmet photo taken from the back
Atom Gig Economy Friday, February 26, 2021 - 19:50

Fuel prices have surged in the last month and have led to increased day-to-day costs. Prices have continued to hold for three days, but continue to be at record highs. This has impacted the earnings of delivery workers due to an increase in costs. 

On Thursday, Zomato CEO Deepinder Goyal said that the company’s delivery partners travel 100-200 kms each day for food deliveries, and the increase in fuel costs has led their monthly spend on fuel to increase Rs 600-800, or about 3% of their monthly income). Zomato said its delivery partners use anywhere between 60 and 80 litres of fuel in a month. 

“Keeping the increasing cost of operations in mind, we have increased the pay structure for our delivery partners by 7-8% going forward,” Deepinder Goyal said. This comes as an additional component of distance pay, and will be applicable over and above the existing remuneration. This, Zomato said, will be applicable over and above the existing remuneration of delivery workers, and will be adapted automatically in the future depending on the change in fuel prices. 

This increase, Goyal said, has been rolled out in 40 cities and will follow in other cities as well.  He added that this cost is not being passed to customers yet. 

“We are working to make Zomato the best place to work for our delivery partners and are focused on solving for all concerns they may face on the road everyday,” he added. 

Earlier this week, Zomato raised $250 million (around Rs 1,800 crore) in a new funding round from five different investors. It valued Zomato at a post-money valuation of $5.4 billion, Info Edge, a publicly listed investor in Zomato, disclosed in a filing to National Stock Exchange of India. The new valuation marked an increase from $3.9 billion valuation of Zomato in December.

The five investors who have pumped money in the new round were Kora (which contributed $115 million), Fidelity ($55 million), Tiger Global ($50 million), Bow Wave ($20 million) and Dragoneer ($10 million).

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