Zomato Pulls Out Of 225 Small Cities Due To Business Slowdown

New Delhi: Food delivery company Zomato on Sunday announced that it has ceased operations in 225 smaller cities as the performance of these cities was ‘not very encouraging’.

It also reported losses of Rs 346.6 crore for the quarter that ended in December due to slowdown in the food delivery business.

“The current slowdown in demand was unexpected, which is impacting the growth in food delivery profits. But despite that, we think we are in a good position to meet our profitability goal,” Zomato said in its Q3 report.

Talking about the move, the company said, “Performance of these cities was not very encouraging in the past few quarters, and we did not feel the payback period on our investments in these cities was acceptable.”

The company, in its financial earnings report, noted that Zomato food delivery service made an exit from ‘225 smaller cities in January, which contributed 0.3% of its gross order value in the December quarter’.