Blinkit and Zepto are raising commissions to boost revenue amid competition and investor concerns. Zepto’s hikes align with its IPO plans, while Blinkit is shifting to a variable model. Both firms continue aggressive expansion despite increased cash burn and market pressures.
Agencies
Blinkit and Zepto, the top two quick commerce platforms, are increasing commissions they charge to boost revenue amid intense competition and a push for profitability.
Zepto has been gradually raising commissions levied on users and brands to improve unit economics, while Blinkit has shifted to a variable commission model for brands and sellers, people aware of the matter said.
Aggressive expansion by quick commerce companies in the face of heightened competition has led to an increase in their cash burn. This in turn is hurting investor sentiment, causing market cap erosion for listed players like Blinkit's parent Zomato and Swiggy that owns the Instamart platform. Instamart and new players in the segment like Flipkart Minutes have not changed their commission structures yet.
Zepto’s bid to strengthen its unit economics is also linked to its plans for an initial public offering this year, even as the stock markets have fallen significantly since December stoking concerns for companies planning public issues.
For Blinkit, its new structure could enhance the total take rate, or the percentage of the gross order value (GOV) that a platform retains as commission, sources said.
Zepto’s take rate has also risen to 22-23% and may increase further as it nears a $4 billion gross sales run rate next month on an annualised basis. Zepto, which was last valued at $5 billion, said it had hit $3 billion in annualised gross sales in January.
“Yes, Zepto has hiked commissions as the business scales and there is constant work on the bottom line,” said a person aware of the matter, adding that this trend will continue in coming months.
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The net fee for existing Zepto users is higher than that for new ones, said people in the know. This is part of the company’s broader push toward operating profitability ahead of its IPO — CEO Aadit Palicha has outlined this to mutual fund investors in recent weeks during discussions on its public issue.
“The company outlined the last quarter of FY26 (for the IPO) to local investors, but the internal target is to do it sooner,” said another person. “The platform now has close to 1,000 dark stores, nearly the same as Blinkit,” he added.
Meanwhile, the Bengaluru-based firm has held talks with third-party fleet operators like the Ola group for deliveries. “The idea is to bring down per delivery cost — as basic as that. For certain bulk orders, Zepto has discussed delivering through third-party platforms,” a person aware of the discussions said.
In its current commission system, Blinkit has a fixed rate, ranged between 3% and 18% depending on the category. But from March 13, it will charge rates as per the selling price of the items, even within the same category, Blinkit informed sellers in an email, which ET has seen.
For example, items that are sold for less than Rs 500 will attract a 2% commission, while those priced between Rs 500 and Rs 700 will be levied 6%. Products priced Rs 1,200 and above will face an 18% commission.
These are only the marketplace commissions. In addition to these, brands and sellers also pay other fees for storage, warehousing and deliveries — taking the share of quick commerce firms to around 30-35% of the selling prices. Also, these terms vary depending on the size of the brands. Larger companies with a higher negotiating power end up paying less to the platforms.
Emails sent to Zepto and Blinkit did not elicit a response.
“The product and category mix on the (Blinkit) marketplace has changed drastically since the fixed commission rates were introduced. Now, there are thousands of SKUs (stock-keeping units) with higher ASPs (average selling prices) but because of how the rate for a particular category was decided, Blinkit’s take rates didn’t improve even if AOVs (average order value) increased,” a senior executive in the know explained.
While the increase in commission is focussed on improving financials, there is no letting up in terms of spending to corner market share. “It remains as intense as ever but now levers are being tapped to generate more cash, keeping in mind the broader market conditions. Zepto has secured the No.2 rank, but Blinkit still is the largest and continues to be aggressive as well,” a person aware of the goings-on said.
According to a report by Morgan Stanley, Blinkit had reported a take rate of 17.9% for the October-December quarter, down 0.91 percentage point sequentially and 0.24 percentage point year-on-year.
In a research note this month, brokerage firm Bernstein noted that quick commerce firms derive higher take rates from new-age direct-to-consumer brands.
“We analysed the mix of brands in Instamart, Zepto and Blinkit and found that Blinkit has a stronger mix of new-age brands compared to Zepto and Instamart. While Blinkit has 39% new-age brands, Zepto has 31% and Instamart has 33% new-age brands as a part of their overall brand mix,” it said.
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