Business

Zomato, Swiggy struggle to cope with demand on New Year’s Eve

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Zomato and Swiggy saw record orders as people chose to ring in the New Year at home because of fears about the pandemic. People mostly chose biryanis and pizzas as they bade goodbye to 2020, according to food-delivery platforms and restaurateurs.

Zomato said it hit record gross merchandise value (GMV) on 31 December. The platform hit a peak of 4,254 orders a minute in the evening, co-founder and CEO Deepinder Goyal said. Zomato’s GMV rose 60% from the previous year.

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Rival Swiggy hit a peak of 5,500 orders per minute on the 31st evening and its base of new users doubled.

Restaurants and cloud kitchens said they did brisk business.

“Yesterday, we clocked 60% more gross merchandise value than last New Year’s Eve. That’s GMV of 75 crore in one single day, with peak orders per minute rate of 4,254,” Goyal tweeted on Friday.

It worked with 100,000 delivery partners on Thursday to fulfil orders across India.

“The demand last night was much higher than what we could process. We ran out of delivery partner capacity much before peak time. If we had unconstrained supply, we could have hit 100 crore of GMV yesterday. Need to do better next time,” Goyal said.

Local restrictions in several large cities, including curbs on public gatherings and a cap on the number of diners in restaurants and bars, prompted people to stay in.

This, Goyal said, was seen in the high number of orders being placed as early as 6:30pm on Thursday evening.

“Our order velocity right now is the highest we have seen in our life so far (~2,500 orders per minute),” he said on Thursday.

At around 8pm, the platform’s system was seeing an “insane amount of strain” as it processed 140,000 live orders, Goyal said. Its delivery executives were ferrying 20,000 biryani and 16,000 pizza orders then.

The Delhi government announced a curfew on gatherings and events at public places between 11pm and 6 am on 31st and 1st nights to prevent large crowds.

However, the restrictions did not apply to licensed premises such as hotels, bars and restaurants, although such venues have to follow social distancing norms.

States such as Maharashtra, Punjab and parts of Gujarat had already announced night curfews ahead of year-end celebrations.

For the restaurant industry, the days from Christmas to New Year’s Eve are important for business.

Bars and restaurants had earlier said they expect to match up to 30-40% of last year’s business on New Year’s Eve, citing such restrictions.

Swiggy too reported numbers well beyond its own internal targets. The company had in a previous statement to the media said it expects a 50% jump in orders on New Year’s Eve.

“Traffic increased by 100% during dinner time (on 31st), with tier-2 and tier-3 cities like Jaipur, Vizag etc. increasing by almost 200%. Tier-3 and 4 cities such as Berhampur, Rourkela, Karimnagar saw a 150 to 200% growth, higher than what we have observed in the metros,” said a Swiggy spokesperson.

Cloud kitchen company Rebel Foods, which operatesfood brands Faasos, Behrouz Biryani, Mandarin Oak, Oven Story and Sweet Truth in India, too, said tier-2 and tier-3 cities reported a massive surge in orders.

“This year due to night curfew implementation, we did more business than 31st December last year, supported by larger bucket size orders with higher average order value,” said Raghav Joshi, co-founder and CEO India Business Unit, Rebel Foods.

Biryani, pizzas and desserts each grew massively in our portfolio, Joshi said.

Consumers, he said, ordered more biryani for lunch on 31st and the day ended with pizzas “catching up and taking the lead”.

Its Oven Story and Behrouz Biryani outlets saw the highest number of orders, followed by Sweet Truth.

Mumbai was the biggest city for the company followed by the Delhi-National Capital Region and then Bengaluru and Pune, “but a huge change from last year was the 40% higher sales generated by tier-2 and 3 cities compared to last year”, Joshi said.

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