Said No to a Zomato Commission Hike? What Mumbai Restaurant Owners Reported Next

What YourStory found

In April 2023, YourStory published an investigation in which restaurant owners in Mumbai spoke about their dealings with Zomato. Several described the same sequence: they pushed back when Zomato asked them to raise their commission, and soon afterwards their service on the app appeared to get worse. The piece also made room for other explanations of the same symptoms, which makes it more balanced than a list of complaints.

A 4 km radius after a refusal

One owner, whom YourStory called Pankaj Kumar (not his real name), said Zomato had spent roughly a month and a half asking him to increase his commission on average order value. When he declined, he was given to understand that his restaurant's visibility might suffer.

A few days later his delivery radius was reduced to 4 km. He asked Zomato to put the change in writing; by his account, it then stopped replying to him and no email ever arrived. Over the same period, while the app was showing his restaurant as unavailable, orders through his own website, which runs on Uengage, went up noticeably.

A cloud kitchen's radius cut, and a more cautious reading

Bansi Kotecha, co-founder of the Mumbai cloud-kitchen brand Kytchens, which operates seven kitchens, told YourStory that his radius had shrunk from 5–7 km to 3–4 km. Separately, he had been asked for a 25% increase in commission.

Kotecha did not jump to calling it retaliation. He said the number of delivery executives drops every summer because of the heat, and that this could be one reason for the smaller radius. Another owner quoted in the piece suggested a rise in Eid-related orders and staff taking leave at the same time, and said a similar problem had appeared on Swiggy during that period.

How one owner split the cost of discounts

Kumar also explained how the discounts on his listing were funded. He paid 80% of the discount Zomato customers saw, and Zomato paid the other 20%. When the commission talks stalled, he offered to fund 100% of the discount himself instead of agreeing to a higher rate.

Paid menu opens replaced organic ones

Zomato sells "menu opens", a paid feature that pushes a restaurant so that more people tap into its menu. Kumar's figures suggest those extra taps were not additional. In a month with 10,000 organic menu opens, he bought 2,000 more and ended up with about the same total, because his organic count fell by roughly the number he had paid for. In his words, each time he bought them, "my organic numbers would decrease".

Commission terms differ from one restaurant to the next

Shaurya Malwa, co-founder of the Vietnamese bistro Nho Saigon and the mead taproom The Canary, runs mainly dine-in businesses and was not affected by radius changes. He described how commission talks tend to go: "The negotiation starts at 20%", then comes down in stages to 18%, 12% and 10%.

Set beside Kumar being asked for a 2% increase and Kotecha for 25%, these accounts show that the commission asks were far from uniform. Zomato did not reply to YourStory's request for comment on them. On the evidence in the piece, it is hard to say whether any single radius cut was retaliation or a seasonal supply problem.

What this means for your restaurant

• If your delivery radius changes, ask Zomato to confirm it in writing and note the date, then check it against summer rider shortages or festival demand before deciding on the cause.
• Before paying for menu opens, compare your organic menu opens in months with and without the spend; Kumar found the paid clicks replaced organic ones instead of adding to them.
• Know what share of each discount you fund. Kumar's 80:20 split with Zomato gave him something concrete to offer in place of a higher commission.
• Treat the first commission figure as the start of a negotiation; Malwa described talks that begin at 20% and come down step by step.

Sources

1. After commission talks, Zomato restaurant partners complain, reduce service radius — YourStory

This article summarises the reporting and guides listed above; the figures belong to those sources and are attributed in the text. Check anything that affects your business against your own platform agreements, payout statements and advisers.