In an effort to expand its business diversification, Zomato, a prominent player in the foodtech industry, has entered the logistics sector by introducing a rapid parcel delivery service for merchants through its new app, Xtreme.
“Xtreme simplifies the entire delivery process, making it easy for merchants to send packages to their valued customers. Whether you’re a small shop or a large retailer, we’ve got you covered,” reads the homepage of Zomato’s Xtreme app.
The app also specifies that package delivery charges begin at INR 35. Additionally, it highlights that Xtreme boasts a substantial network of over 300,000 delivery partners. It’s important to note that as of now, the Xtreme app is exclusively available for Android users.
The development was first reported by Moneycontrol.
Zomato chose not to provide any comments in response to inquiries regarding the new launch.
Although the app positions Xtreme as a solution for merchants seeking to streamline package deliveries, there is still uncertainty surrounding how the app distinguishes between business and retail deliveries. It has come to light that the app also accommodates retail customers for package deliveries.
Swiggy, a rival of Zomato, operates its parcel delivery service known as Swiggy Genie. In contrast to Zomato’s approach, Swiggy Genie serves both retail customers and business delivery requirements, offering a more versatile delivery solution.
In addition to Swiggy and the struggling Dunzo, Xtreme will face competition from players like Porter and the newly introduced Ola Parcel. However, it’s worth noting that these companies don’t restrict their logistics services solely to business deliveries.
Zomato appears to be placing a strategic emphasis on logistics as its latest endeavor, particularly as the publicly listed startup seeks to diversify its operations with the aim of strengthening both its top and bottom lines.
Earlier this year, reports indicated that Zomato was in the early stages of testing B2B logistics services and had intentions to collaborate with e-commerce platforms to facilitate the delivery of food, pharmaceuticals, and various other consumer products to customers.
Last year, the company made strategic moves by entering the quick commerce space with the acquisition of Blinkit. Simultaneously, it introduced the intercity food delivery service known as Zomato Legends. Additionally, during that time, the company began implementing a platform fee for food delivery orders.
In the midst of the logistics service launch announcement, Zomato notified the stock exchanges of its ongoing efforts to file an appeal against a ruling from the District Consumer Dispute Redressal Forum (II) Jodhpur. This ruling imposed a fine of INR 1 Lakh on both Zomato and McDonald’s.
As of 2:50 PM IST on Friday, Zomato’s shares on the BSE were trading at INR 111.15, reflecting a gain of more than 1%.