Surge pricing, a concept users of Ola and Uber would be familiar with, has now entered the quick commerce space.
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How It Works
Blinkit will now charge “high demand surge fee” during peak demand hours, a first for the grocery delivery space.
The grocery delivery company said that surge charges will be applicable during peak demand in the area.
The charges will be withdrawn when the demand normalises.
Other Examples
It has been charging surge fares in the range of Rs 20-50 in recent weeks.
Food aggregator apps such as Swiggy and Zomato are known to charge surge fees during inclement weather or late night deliveries.
Bigbasket and Zepto charge delivery fees if the ordered items are few in number.
To Please Investors
Blinkit’s move is an effort to reduce its burn rate and increase profitability.
Analysts say that such moves are an attempt to meet investor expectations.
Since quick commerce is in a fledgling state in India, different strategies are being used by companies..
However, customers are unlikely to be willing to pay a premium on groceries.
Shutting Stores Despite Fundraising
Blinkit recently closed about 40 dark (or delivery-only) stores and is in the process of rationalising costs.
This, despite the fact that it received an additional $100 million financing earlier this week.
The SoftBank-backed firm has a network of more than 100 partner stores or warehouses in eight cities through which it makes 10-minute deliveries.
Chief executive and founder of Blinkit Albinder Dhindsa saind in an internal note that the company will continue to focus on growth, reducing burn rate and improving speed of execution.