The online food delivery market in India is expected to expand at compound annual growth rates

of ~30.55% (based on revenue) and ~10.19% (based on the number of users) during the 2020-
2024 period, to generate a revenue of INR ~1,334.99 Bn and develop a user base of ~300.57 Mn
by 2024. Major players currently operating in the Indian online food delivery market include
platform-to-customer service providers like Swiggy (Bundl Technologies Private Limited),
FreshMenu (FoodVista India Private Limited), Faasos (Rebel Foods Private Limited) and Zomato
(Zomato Media Private Limited). Apart from these, there exist certain companies that operate
with a restaurant-to-customer delivery model like Box8, Domino's (Domino's Pizza, Inc.), and
KFC (Yum! Brands, Inc.).

As of 2019, millennials accounted for ~63% of the overall user base of the online food delivery
market. This is owed to increasing disposable income of the millennials, especially in the urban
regions in India. Also, millennials prefer ordering food online since it is easy to handle and saves
time and energy of cooking at home.
In 2019, out of the major online food delivery service providers, Zomato held a share of ~38% in
terms of user base. Swiggy held a share of ~27% in the online food delivery user base of India in
2019. High adoption rates in tier I and tier II cities, as well as swift delivery services has helped
these two companies to gain the high share in the Indian market.

Key growth driver of the market

In the recent years, the number of working women has increased in the Indian workforce,
especially in the city-based organized sectors. As a result, the number of double income families
in also on the rise. With both the partners working and maintaining hectic working schedules, it
become difficult for people to get time and energy to cook at home. Moreover, the dual income
scenario has increased the overall spending capacity of the families. Also, the key players like
Swiggy, and Zomato keep on announcing lucrative offers for the customers, both existing and
new, in order to keep up the stiff competition in the online food ordering market. This in turn is
leading towards people’s preference towards ordering food online and enjoying their favourite
cuisine at home at an affordable price, thereby increasing the overall value and user base of the
online food ordering market in India.

Key deterrent to the growth of the market

Recently, there have been several instances of spurious and closed restaurants; and food shops
taking orders on food platforms, only to be informed later that either the shop cannot be located
or had shut operations. Cases were reported where certain outlets registered on these food
delivery apps have turned out to be makeshift, or operate out of home joints, with hardly any
focus on hygiene and quality. This has caused annoyance among both the customers and the
food delivery executives. Also, consumers are becoming concerned about the quality of food
since such unauthorized food stalls seldom maintain hygiene both while cooking and packaging.
This, in turn, is developing dissatisfaction among the customers of the online food delivery
market in India.

The India online food delivery market reached a value of US$ 4.35 Billion in

2020. Online food delivery assists individuals in ordering and receiving the
desired food products at the doorstep. It involves browsing the website or
application, selecting from a wide variety of cuisines available and making the
payment through different methods. The website/application updates the user
about the expected duration of food preparation and delivery. These features,
in confluence with attributes such as ease, speed and precision of delivery, are
increasing the demand for these services in India.

Although the players are mainly concentrated in the urban regions of the
country, with Bangalore, Delhi and Mumbai representing the three largest
markets, vendors are now also targeting smaller cities, as they have strong
growth potential. Moreover, the rising trend of the on-the-go food items and
quick home delivery models that offer convenience, ready-to-eat (RTE) and
cheaper food delivery options are escalating the demand for online food
delivery services in the country. Furthermore, owing to the rising cases of
COVID-19, some of the leading players like Zomato, McDonald's Corporation
and Domino’s Pizza Inc. have introduced contactless delivery services. These
services ensure that the food reaches the customer without being touched by
bare hands and is delivered safely with adequate social distancing measures.
Looking forward, IMARC Group expects the India online food delivery market
to exhibit strong growth during the next five years.

Breakup by Platform Type:

 Mobile Applications
 Websites

Breakup by Business Model:

 Order Focused
 Logistics Based
 Full-Service

Breakup by Payment Method:

 Online
 Cash on Delivery (COD)

Regional Insights:

 North India
 West and Central India
 South India
 East India

Competitive Landscape:

 The competitive landscape of the market has been analyzed in the

report, along with the detailed profiles of the major players operating in
the industry. Some of the leading players include Zomato, Swiggy,
Foodpanda, Bundl Technologies, Fasso's, Domino's, etc.

Introduction to Zomato :

Zomato is a food point search and discovery service founded in 2008 by

Deepinder Goyal and Pankaj Chaddah. It is currently operates in 25 countries,
including India, Australia. Brasil, New Zeland, Singapore and the United
States and in middle East Qatar.

Zomato began life as FoodieBay, which was an online restaurant directory

As one of the premier attractions of the Indian startup ecosystem, Zomato

is well known throughout the country and has also ventured into many
international markets over the years.

The foodtech unicorn was founded by Deepinder Goyal and Pankaj

Chaddah, when the former was working at Bain and Company and found it
troublesome to find the right restaurant menus at meal times. Ever
enterprising, Goyal started clicking photos of the menu and sharing it with
his colleagues to make ordering easier. Not only did this simply lunch-
ordering, but opened up a whole new business for Goyal. processing of
ordering in.

Chaddah came on board to help Goyal launch Foodiebay in 2008, which let
users check restaurant menus and review the properties. Today, more than
a decade later, the company has added components to its business such
as online food ordering, restaurant reservations and loyalty programmes,
enablement for restaurants, consultancy services and a lot more.
Over the years, Zomato has been through many highs and lows and has
kept up with rival Swiggy in the online food ordering segment. From raising
funds from major investors to the exit of Chaddah, Zomato has stayed in
the public eye even as business boomed and funding kept coming in.

The company has strengthened its presence in Tier 2/3/4 markets over the
past year with its expansion, but at the same time it is embroiled in a long-
standing battle with restaurants to change its discount-happy ways.
Whether this has a deep impact on Zomato’s overall business is yet to be
seen, but the fact is Zomato has opened up many more channels for
revenue through its business model diversification.

1. Restaurant Listings / Advertising

2. Food Delivery
3. Subscription Programmes
4. Live Events
5. White Label Access
6. Zomato Kitchens

Restaurant Listings / Advertising

 In its first avatar, Zomato was just a listing platform and a restaurant
directory. This brought in advertising revenues from restaurants who
joined the platform. Extending this further after the launch of food
delivery and restaurant reservations, Zomato now charges
commissions from restaurants to be placed prominently on the feed.
Restaurants can pay to have their events or offers promoted as well
as their overall banner, which brings improved visibility and
conversions from Zomato users.

 Food Delivery

To begin with, through its food delivery business, Zomato charges a

commission to the restaurants on the basis of orders. While users
pay a delivery fee, Zomato earns through restaurants who pay a
commission for each delivery, which is then split among the delivery
partner and the company. Commissions from restaurants vary based
on whether Zomato is fulfilling the delivery or whether the restaurant
uses its own riders. This is said to contribute in a small way to the
company’s total income due to huge competition and need for deep
discounts etc.

 Subscription Programmes

With Zomato Gold for consumers and users, and subscription

solutions for restaurants, Zomato opened up a steady stream of
revenue. While users pay a subscription fee to access the Zomato
Gold loyalty programme which brings exclusive offers, restaurants
also pay a monthly fee to be part of Zomato’s bouquet of offers.
Restaurants also pay Zomato a monthly fee for miscellaneous
services such as live tracking, Zomato-branded tamper-proof
packaging and more.

 Live Events

With Zomaland, Zomato entered the branded live events market last
year. Zomato charges users an entry fee to attend Zomaland, where
besides food, they can witness live musical performances and other
acts. In 2018, it had organised the entertainment carnival in Delhi,
Pune, and Bengaluru, where Zomato claimed over 100K people
showed up. This year, Zomaland is going to Pune, Delhi, Bangalore,
Hyderabad, Mumbai, Jaipur, Pune, Chandigarh, and Kolkata.

 White Label Access

 Zomato also enables services such as Zomato Whitelabel under
which they give offers to the restaurants to develop a customized
food delivery app. It also works with cloud kitchens and restaurants
for consultancy services. Zomato works with select restaurant
operators to help in identifying locations for expansions at a minimal
fixed cost, but with increased options for the user. It provides the
requisite licenses and operational enablement for such restaurant
partners.

 Zomato Kitchens

In order to be able to provide kitchen infrastructure services to select

restaurant operators, Zomato works with entrepreneurs to set up and
operate Zomato Kitchens under different labels. This helps
entrepreneurs fund restaurants in the right location with an
investment of INR 35 Lakh and more.  Zomato claims it offers returns
in the range of INR 2 Lakh to INR 4 Lakh per month to the investors,
with 180+ affiliate kitchens already up and running.

As it has grown in size and scale, Zomato has tried to reduce the reliance
on cash-burn reliant models and streamlined to enter enablement and other
user-generated streams of revenue.  Zomato’s cash burn is mostly in
retaining users against its rival Swiggy. However, being in the line of fire for
deep discounting practices, Zomato may soon be able to earn from other
parts of its business model.
Advertising on their website and appZomato’s advertising is to the point, when
users search for specific keywords, ads of restaurants are shown for that
specific keyword. This makes it highly targeted. This is also hyper local.

Consulting services with data

98% of restaurants fall within the first year and Zomato can help in this!
Zomato sits on a pile of data and information. They have an in-built analytics
platform that run a lot of queries and get important information out. Say if a
person wishes to open a new food point, they can approach with Zomato and
find out the success rate of opening a restaurant in a particular location. Food
point owners can also find out what is the most popular type of food in the
area, understand the needs of the customers and provide a complimenting
service that will help build their business.

Zomato Events

Zomato  has forayed into the events space by partnering with restaurants and
creating limited events. They make a sale through the price of the tickets. A lot
of Zomato hosted annual parties were held.
Online Food Ordering

Very late to the game, Zomato started their online food delivery service.
Different from other players like Swiggy, Zomato does not have their own
delivery system, they let users place the order through the website or the app
and the restaurant fulfil that order through by their own.

Zomato started food point guide for the famous cities in India. They tied up
with the e-commerce behemoth, Flipkart and hoped to sell around 200,000
copies. The last of this food point guide was created in 2012 and has not been
updated since.
At the rate they are spreading and making a strong eco system, At one point
like this , zomato will take a huge piece of Yelp’s business.
Genesis of Zomato

The seed of Zomato was sown approximately 12 years ago. Back in 2008, the
thought was conceived in the minds of three passionate foodies who despised
waiting for so long in colossal queues. It was the need to have access to all
restaurant menus digitally at one place and the passion to make it available for all
that gave birth to Zomato. That idea was their baby, and now that baby has grown
into a vision that drives a team of 5000+ people every day. 
Zomato wasn’t Zomato from the beginning. It started as ‘Foodiebay,’ which
was an online restaurant directory. CEO Deepender Goyal felt the need to
change this name as it resembled ‘eBay’ and he visioned to create a
unique identity of own. Hence the christening ceremonies happened, and
since then, it’s known as Zomato. From a home project, it has lengthened
into a large food aggregator that operates globally. With its footprint in
almost 24 countries and over 10000 cities, it is constantly working towards
its vision of better food for more people. In addition to discovery and
delivery, Zomato has also entered various segments like restaurant
reservations, loyalty programs, and live events. Zomato not only functions
as the connecting link between food and people in every context, instead it
sets an example by cooperating and working with restaurants closely to
enable a sustainable ecosystem.

Business Model

The success of Zomato lies in its robust Business Model. Essentially Zomato is an

application whose business model encircles the provision of food delivery services,
provision of information, user reviews, and menus of partner restaurants. Zomato
stands as the pioneer for other online food-based applications. Following are the
critical elements of Zomato’s business model:

1. Customer Segments: The customer segment of Zomato has been

divided into three parts:

 Local restaurants: Zomato enables restaurants to make

themselves visible to their target audience
  Users: Zomato is dedicated to users who aspire to locate
restaurants or specific cuisines nearby. Zomato is the panacea for
users who are fond of home delivery
 Reviewers: They are content contributors of Zomato. They actively
review food and places and provide relevant information to the
users in textual and graphical form

2. Zomato Provisions: Zomato acts as the connecting bridge between

customers and partner restaurants. Zomato has crafted a well-designed
pricing model for their only delivery services. The inclusion of Zomato Gold
& Piggybank has improved the quality of services provided by Zomato

3. Alliances of Zomato: Recent partnerships with various big names like

Uber Taxi, Visa, PayPal has enhanced the business model of Zomato.
The partners have aided Zomato in various aspects, for instance, finding a
location to set-up, hiring and other procedures, work placements, market
research, handling operational, accounting, political and legal issues, etc.

Value propositions of Zomato

Zomato is immensely loved for the way it works. Zomato is premised on the
QAAA model, i.e., it promises and delivers Quality, Accessibility, Affordability,
and Assortment to its customers and partners. Following are the value propositions
of Zomato, which makes Zomato unique and admirable:

1. Improving food quality: Zomato is wholly dedicated to nurturing a neutral

platform. It consistently aids food establishments in maintaining high
standards through Hyper pure. Hyperpure is an innovative initiative by
Zomato to bring fresh, squeaky clean, and high-quality ingredients and
kitchen supplies to its partner restaurants. Food Hygiene rating is the most
yearned for a symbol of quality well known among its partner restaurants. 
2. Boosting accessibility for customers: Zomato delivery is increasing
since its inception and expanding its reach to more and more cities. They
are vigorously growing their services. Now they offer table reservations,
perform corporate catering, and feeding India.
3. Ensuring affordability: The success of Zomato gold speaks volumes for
Zomato’s efficiency in providing an array of exciting choices. Zomato
continually strives and leaves no stone unturned in delivering the best.
They ensure affordability without compromising on their profits.
4. Aid in the assortment: Zomato believes in enabling its customers in
unearthing band new tastes and experiences transcending geographical
borders. They present the best information in the most legible manner for
their customers and help them in making an informed choice.
Key activities of Zomato

Following are the prime activities undertaken by

Zomato:
1. Managing network effects: Zomato is the linking chain between
restaurants and customers
2. Managing to advertise: Zomato holds a reservoir of the user database,
which it further uses for advertisement. The company posts
advertisements for various restaurants, thereby generating handsome
revenue for itself.
3. Enhancing customer experience: Zomato undertakes myriads of
activities to continue to improve customer experience. It keeps its features
updated in synch with emerging trends.
4. Keeping up the brand image: Zomato tries to hold its dignity as the
provider of information for the foodie community by ensuring the flow of
authentic information that helps its customer to address two essential
questions, i.e., what to eat and where to eat.
5. Online food delivery and subscription: Initiated for food discovery
solutions, Zomato ventured into the food delivery segment as well and
introduced a subscription feature later on
6. Consultant for partners: Zomato holds a massive repository of user
databases and uses various analytical tools to unearth vital pieces of
information. That becomes the food for customized consultancy services
provided to partner restaurants and eateries. 
7. Zomato Whitelabel: Zomato also helps restaurants in developing their
own robust app with the aid of a platform known as plug and play.

Revenue streams for Zomato

1. Commission on Delivery services: These commissions formed about

75% of the total revenue of Zomato for FY2019. This amounted to $155M,
which was four times what they made previously.
2. Zomato Gold: This is a freemium model based idea. The concept aims at
providing premium services to subscribers. This system helps the
customer in enjoying complimentary food and beverage services offered
they have gold memberships. This service alone generated a whopping
$49M in FY19 and $30M in FY20.
3. Ticket sales: The ticket sales for various events held in restaurants in
partnership with Zomato generate a colossal revenue for Zomato in the
disguise of commissions. Zomato also charges for the consultation
services provided to their partners.
4. Promotions: Zomato continually engages in the promotion of various
restaurants. Partners get higher exposure and visibility via banner
promotions, and they are charged by Zomato for the same.
Analysis of Zomato Revenue

A big share of 72% of total revenue comes from restaurant advertising and
marketing. Approximately 12% of the revenue comes from ticket sales. Even
advertising contributes about 4% of the total revenue. 3% and 2% comes
from consulting and food delivery services, respectively. Zomato Gold and other
analytical services contribute around 7% to the total sum of revenue.

Key Resources

Top-notch database, dedicated employees, talented community of content

contributors and reviewers, the aura of the Zomato brand, and huge pipeline of
funding partners including famous investors like Ant Financial, Sequoia Capital,
Info Edge etc; these are the key resources that enable Zomato to stand tall in the
food industry.
What’s in the future for the food industry & Zomato?

Zomato recently published Mid-COVID Report for India. In their report, they
shared this finding that the Food delivery sector has recovered with some regional
flavors to it and in fact, grown beyond pre-COVID levels in myriads of large
pockets of the country, with some affluent residential areas being the forerunners
in this recovery. Due to the advent of lockdown and everything moving back at the
home trend, many premium restaurants are being receptive to the idea of online
delivery, and that is attracting a lot of affluent customers. In fact, during the
lockdown, it was observed that customers started to rely more on online deliveries.
As people are indulging in taking up more quality time with their families and
loved ones, group ordering is becoming a frequent reality. Ongoing IPL and the
festive season has bolstered the growth in the food delivery sector. Hence good
times are ahead for Zomato.
Zomato has revolutionized the entire food industry by turning the concept of
universal access into reality. If you’re envisaging to create an online marketplace
just like Zomato, you can fearlessly trust our tool Yelo. No coding, no setup fee &
launch within a day! And the surprises don’t just end there. Yelo is an industry-
leading product with features crafted perfectly to run a full-blown online
marketplace globally. From browsing to making payments and all the technical
nitty-gritty that goes inside, Yelo takes care of it all.
Hyperpure is the big step we are taking towards creating the future of food.
It is a clean food supply chain for restaurants to buy fresh and high-quality
ingredients. Responsible local farmers and suppliers are signing up on
Hyperpure to find responsible restaurateurs who will buy their produce —
without the usual middlemen.
https://www.zomato.com/blog/annual-report-19

Zomato billed cloud kitchens as the future of food. 

“The operational model of delivery may evolve, the way cloud
kitchens came up in the recent past…we could expect large food
delivery trucks and mobile kitchens from these (aggregator)
companies for safer contact-less delivery,” said Sreeedhar Prasad,
an independent ecommerce analyst.

Early indications are that platforms need more people than ever to
order through them. They need more supplies to build a business
beyond metropolitan cities. They will also need to be more effective
than home-cooked food.
Platforms will need to make peace with restaurant owners. A good
part of 2019 was marked by a tussle between NRAI and Zomato
through multiple "log out" campaigns by restaurants. The year 2020
is lost to a pandemic. The industry cannot stand divided in 2021.

The food business needs to transform technologically. “Restaurants

need to invest a lot in technology themselves. Hire engineers,
analyse customer data, capture trends, only then will they be able
to improve their business margins,

Consumers, too, need to change. They will have to be prepared to

pay more for delivery and platforms will have to make it worth it—be
it hygiene, safety or health.

Platforms will have to make their models more efficient. Can there
be time slots for deliveries instead of a flat 30-minute promise? If a
rider can make multiple deliveries in one run, the cost will be
justified.

Finally, food delivery as a standalone business will be tough. The

competition will not only be from Amazon. Tech giant Google has to
just add an ‘Order Now’ button on the results page to drive traffic
away from Zomato, Swiggy and other players.
https://www.moneycontrol.com/news/business/startup/whats-next-for-zomato-and-swiggy-
after-the-coronavirus-clobbering-5622581.html

The reason that Zomato. chose this specific changing style was to avoid the resistance to

change, which might be due to the inefficient communication and education (Will, 2015). In

addition, changing style between direction and coercion guaranteed the speed of the change

because every single person involved in the changing process would be clearly instructed and

directed (Hempel, & Martinsons, 2009) which ensured that no time was wasted in debating

and negotiation.

Analysis of change by using CKM

Scope and Preservation

Diversity
Capability and capacity

https://www.hcltech.com/blogs/change-management-during-covid-19
Employee safety first: Educate and support employees in managing the crisis through Central
Response Centers, and create awareness about precautions, regulatory compliances etc.

Business continuity with employee safety: Remote working, empowered virtual teams, and
customer support for emergency services.

Future state of organization: The COVID-19 situation offers both opportunities and challenges to
business leaders and they are responding based on the culture and vision of the organization.
The progressive organizations are looking to transform their business models and ways of
working in place of merely reacting to the current situation.

This pandemic will drive multiple transformations in an organization’s ways of working and
require a differentiated change management strategy focused on consistent communication,
coaching, training, and learning to adopt new ways of working that were never envisaged earlier.
Some of the key initiatives that will be enabled through effective change management in the post
COVID-19 era are:
Building a Sustainable Post-COVID 19 Future
During COVID-19, organizations have experienced a pause in their growth acceleration, though
each one of them has adopted different strategies to survive in these tough times. For
organizations, it is a moment to break from the past inertia, adapt to the new normal, and think of
changes to be made in the current people, processes, and technology dimensions to make itself
a healthy and resilient organization. The reinvention of the organizational DNA, driven by an
effective change management program, should help build a sustainable future where employees
work in a safer environment and collaborate effectively to deliver organizational goals.

A Redseer analysis reveals that from $4.4 billion, the food delivery
gross merchandise volume fell to a billion dollars during the
lockdown that started on March 25. In May, some restrictions were
lifted and that helped the business but it has been slow march
recovery.

The industry has pinned its hope on September and October.

Post Covid Morepeople are expected to get back to cities to return

to offices, which will also coincide with the festival season, a time
when consumption tends to go up. 

“Grocery is a thin margin business. If they cannot make food

delivery viable, making grocery delivery work will be a greater
challenge,” said Agarwal of Redseer. Zomato attempted grocery
delivery but they exited the business within months of starting it.

In India, Zomato clocked a revenue of $394 million last year, one of

its best showings. In June 2020, it clocked $17 million and in the
March quarter, it was $41 million. Even at this rate, Zomato may
end the year with less than $300 million in revenue.

https://www.moneycontrol.com/news/business/startup/whats-next-for-zomato-and-swiggy-
after-the-coronavirus-clobbering-5622581.html
Post Covid more people are expected to get back to cities to return to offices, which will also
coincide with the festival season, a time when consumption tends to go up. 

https://www.moneycontrol.com/news/business/startup/whats-next-for-zomato-and-swiggy-
after-the-coronavirus-clobbering-5622581.html

3. Change Levers –

https://www.zomato.com/blog/mid-covid-report-2

1. Delhi and Mumbai are nearing full recovery (95% of pre-COVID),

metros such as Bengaluru, Hyderabad, and Chennai are still behind
the curve (~80% of pre-COVID). Some cities such as Kolkata, Patna,
Jamshedpur, Ranchi, and Siliguri have recovered completely and
have exceeded pre-COVID levels.
3. With more premium restaurants, i.e. restaurants where a meal for two
may cost ₹1500 and above, now opening up to online delivery, a larger
number of affluent consumers are embracing online ordering. Overall
spends on such premium restaurants have grown by over 25% over pre-
COVID levels.

4. Customers are now relying on food delivery even more than usual when
a city goes under a lockdown. Some cities such as Kolkata see more
customers ordering online when the city is (more or less) shut, but
restaurants are open.

5. With lockdown restrictions, celebrations have moved back home.

Festivals and occasions such as Raksha Bandhan, Janmashtami,
Teacher’s Day, and Independence Day saw a massive spike in orders.
Customers, who had not ordered since the first day of lockdown, are 20%
more likely to order for the first time during such festivals and occasions.

6. As customers spend more time with their families, group ordering has
become more relevant than ever. Order sizes, i.e. items per order, have
increased by 20% over pre-COVID levels. Recovery on single person
meals, which constituted nearly ~60% of all orders pre-COVID, lingers at
50-70% level for most regions. On the other hand, orders with meals for 3
or more persons have recovered well and are higher than even pre-COVID
levels currently.
With the ongoing IPL season and the subsequent festival season, we
expect food delivery in both metros and smaller cities to make a full
recovery soon – and resume growing over pre-COVID levels.

Indian Restaurant Industry – Mid

COVID-19 Report
Click here to download this report in PDF.

The pandemic has had a massive effect on the restaurant industry. Over
the last few days, we reached out to thousands of restaurants and
customers across various cities in India to understand the current state and
future outlook of the industry. In this report, we will present our findings for
the two key components of the restaurant industry – delivery, and dining
out.

India Food Delivery

HIGHLIGHT
 The food delivery industry has largely recovered, with the overall
sector clocking around 75-80% of pre-COVID GMV.

KEY TAKEAWAYS

1. Some areas in some cities are clocking higher GMV than before (affluent
neighbourhoods no longer fear contagion from food delivery, and are
combining home entertainment with outside food). Predictably, residential
areas are doing 50% better than commercial areas. Restaurants in and
around commercial districts are expected to take the longest to recover.

2. Zomato has delivered 7 crore food orders since lockdown started on

March 25th. We estimate that between other food aggregators and direct
restaurant channels, Indians have ordered 20 crore times since the
lockdown. There have been zero reported cases of COVID transmission due
to food delivery.

3. Sporadic lockdowns in some cities disrupt business as usual for a few

days. However, food delivery volumes bounce back as soon as these
lockdowns are lifted.

4. The number of restaurants offering food delivery are at 70% of pre-

COVID levels. Out of this, about 5% restaurants did not offer food delivery
services pre-COVID. Most of these are dining out centric places which
have shown agility to pivot to food delivery. 

5. With companies giving employees the option to work from home, there
has been a mass exodus of people from metros to other cities across India
– 1 in every 5 Zomato customers in metros (pre-COVID) have opened their
app from a smaller town recently. Out of these relocated folks, one third
have already started ordering food again from their new location.
6. Interestingly, ordering frequency of customers after their first order mid-
COVID is the same as pre-COVID, which shows that the first order mid-
COVID is key for customers to cross the hump of safety perception.

7. Recovery trends are strong and we estimate the industry to hit pre-
COVID levels of business in the next 2-3 months.

India Dining Out

HIGHLIGHT

Dining out industry in India is yet to bounce back and operating at 8-

10% of pre-COVID levels. Slump in the industry is largely driven by
markets being in lockdown, consumers not stepping out due to fear
of transmission and restaurants not opening up, even if the city is
not in lockdown. 

KEY TAKEAWAYS

1. Even in cities where restrictions have been lifted, only 17% dining out
restaurants are open for business at the moment which are also running at
low capacity.
2. Out of the 83% restaurants that are not open for business, 10%
restaurants have already shut down permanently and we anticipate an
additional 30% restaurants to not reopen at all. Remaining 43% are closed
right now but likely to open, as the situation becomes better. 

3. Most of the customers plan to decrease spending on dining out in the

near future and some of this spend will shift to food delivery. 60%
restaurateurs said they estimate to retain less than half of their original
business volumes for a few months even post-COVID.

4. Safety and hygiene have now become a permanent addition to the

customer’s decision making model. In markets with low COVID incidence
(e.g. New Zealand), safety and hygiene still figure as one of the top factors
but usual factors like price and location have already started commanding a
higher significance in a consumer’s decision making process compared to
two months ago.

5. Strong recovery in international markets paints an optimistic picture –

Zomato’s dining out transactions in markets like New Zealand, UAE and
Portugal are already back to pre-COVID levels. However, recovery in India
will be slow and would largely be driven by industry’s ability to build back
consumer confidence.

Despite the tough macro environment, it is heartening to see restaurants

reimagining their operations rapidly to accommodate new social
engagement constructs. When we step into restaurants now, we are bound
to notice changes (staff wearing masks, tables arranged at a distance,
digital menus, ordering & payment), that were not part of the restaurant
dining experience six months ago. 

We thank all our restaurant partners and customers for their candid
participation in this study. We hope this gives restaurant owners some
useful data and points of view to plan for the future of their businesses.