Zomato is preparing to relaunch its hyperlocal logistics service, Zomato Xtreme, with a renewed focus. Previously designed to handle intracity deliveries for packages up to 10 kg, the service used Zomato’s vast food delivery network to support small businesses and large merchants. Now, the company is recalibrating the offering to align with its core strength in food delivery.
After pausing Zomato Xtreme in July, the company is reportedly working on bringing the service back in a reimagined form. Initially, Zomato Xtreme provided logistics support to a range of merchants for local deliveries, drawing comparisons to similar services in the market. The service also partnered with companies for last-mile delivery solutions.
This time around, the focus will shift back to food delivery. “The service is being refined to prioritize the company’s core business,” said a source familiar with the matter. With over 400,000 active monthly delivery partners, Zomato has built a strong logistics network for food delivery, which will be central to this revamped initiative.
There is growing demand from restaurants looking to maintain their independent ordering systems while leveraging Zomato’s efficient last-mile delivery network. Although the first iteration of Zomato Xtreme did not grow large enough to affect the company’s main business, there is potential for expansion if the new version gains traction. The service is expected to adopt a model similar to Zomato’s current distance-based fee structure.
Zomato has previously experimented with multiple features to enhance its offerings. Despite these explorations, food delivery remains the company’s largest revenue generator, contributing nearly 60% of its total gross order value in recent reports, with a strong increase in orders year-on-year.
Looking ahead, Zomato plans to make significant changes to its platform. Food delivery will soon have its own dedicated app, while other services like dining out and entertainment will be shifted to a separate app, allowing each offering to be streamlined for better user experience.
As Zomato continues to fine-tune its operations, its robust delivery network remains a key asset in maintaining its competitive edge in the market.