The True Cost of Swiggy & Zomato: How Commissions Secretly Eat Your Margin

1. Swiggy and Zomato Are Not Automatically Bad for Restaurants

Before calculating costs, it is important to avoid the opposite mistake.
Delivery platforms provide real value.
They can offer:

• Customer discovery

• Ordering infrastructure

• Payment collection

• Delivery logistics

• Customer support

• Large existing consumer audiences

• Promotional tools

• Advertising inventory

• Technology that would be expensive for many independent restaurants to build themselves
  Swiggy's IPO documents illustrate why restaurants pay for the ecosystem: its food-delivery business earns from restaurant commission and advertising while also carrying delivery and other platform costs. In Q1 FY25, Swiggy reported commission and advertising revenue equivalent to 20.38% of food-delivery AOV—notably, that figure combines multiple revenue streams and should not be interpreted as a universal restaurant commission rate. Swiggy.com So the correct question isn't: “Should restaurants leave Swiggy and Zomato?” It is: “At what economics does each platform order make sense for my restaurant?” That is a much more useful question for Amello to help a restaurant answer.

2. Commission Is Often Only the Beginning

This is where restaurant economics become more complicated.
Depending on the merchant agreement and programmes being used, a restaurant may also encounter costs associated with:

• Applicable taxes on platform services

• Payment-related charges

• Advertising

• Sponsored visibility

• Promotions

• Restaurant-funded discounts

• Loyalty or programme participation

• Other contractual service charges
  Current Zomato merchant terms, for example, explicitly provide for commission or service fees defined in the merchant form and allow deductions of applicable amounts from settlements. Some Zomato dining terms also reference a merchant share of certain promotional offers. Zomato
  Restaurant groups in Bengaluru raised this exact issue in 2026, arguing that headline commission alone did not capture payment, promotional, advertising and other deductions affecting merchant settlements. Business Standard
  So when someone asks:
  “What is my Zomato commission?”
  the better question is:
  “What percentage of gross platform sales do I actually retain after every platform-linked deduction?”
  That is the number Amello should eventually help the restaurant understand.

3. GST on Platform Charges Can Affect the Settlement

Suppose a restaurant pays ₹200 as a platform service charge.
GST can also apply to that service.
This means the cash deducted in the settlement can be greater than the headline service-fee number. A critical nuance: GST deducted or charged on platform services should not automatically be treated as a permanent business cost in every restaurant's profitability calculation. Whether a particular tax amount can be claimed or treated as credit depends on the restaurant's tax position and applicable GST rules.
That is an accounting and tax question, not merely a marketing metric.
So restaurants should separate: Cash deducted from settlement
from: True non-recoverable economic cost and confirm tax treatment with their accountant. Amello should help merchants understand operating performance, but tax treatment should still be handled correctly rather than casually classifying every settlement deduction as lost margin.

4. Restaurant-Funded Discounts Can Cost More Than the Commission

Imagine your normal item price is ₹500.
You run:
20% off
If the restaurant funds the full discount, ₹100 disappears before the platform commission and other costs are considered.
The customer sees:
Great deal.
The restaurant needs to ask:
Did this discount create incremental demand that justified giving up ₹100?
There is a big difference between:

Platform-Funded Discount

The platform absorbs some or all of the promotional cost.

Restaurant-Funded Discount

The restaurant absorbs some or all of the promotional cost.

Shared Discount

Both parties contribute according to agreed commercial terms.
Never evaluate a campaign simply by looking at:
Orders increased 30%.
Ask: Contribution increased by how much?
Because more orders with worse unit economics can increase kitchen workload while barely improving—or even reducing—profit.
Amello helps restaurants think beyond order count and connect campaigns with restaurant performance.

5. Advertising Can Turn Discovery Into Another Cost Per Order

Swiggy and Zomato are not simply delivery channels.
They are also discovery platforms.
Restaurants often pay for:

• Sponsored positions

• Search visibility

• Promotional placements

• Other advertising products
  This creates a second layer of economics.
  You might pay:
  Commission to fulfil the order
  and: Advertising spend to acquire the order.
  Industry reporting has highlighted advertising as an increasingly important revenue stream for food-delivery platforms. The Economic Times
  Consider: Order revenue: ₹700 Ad spend attributed to acquiring that order: ₹40
  That ₹40 needs to be included when evaluating the profitability of that demand.
  Otherwise the restaurant may say:
  “This channel generated ₹7 lakh.”
  when the real question is: “How much did we spend to generate that ₹7 lakh, and what remained afterward?” With Amello, the goal should be to connect marketing activity with sales outcomes rather than looking at ads and revenue as unrelated dashboards.

6. Packaging Is Easy to Forget

Packaging is not necessarily a Swiggy or Zomato commission.
But it is still part of delivery-order economics.
A dine-in order may use:

• Plate

• Glass

• Cutlery
  which are reusable.
  A delivery order may require:

• Food containers

• Bags

• Seals

• Tissue

• Disposable cutlery

• Sauce containers

• Labels

• Tamper-proof packaging
  Suppose packaging costs ₹25 per order.
  At 100 delivery orders:
  ₹2,500
  At 3,000 monthly orders:
  ₹75,000
  That is real money. Recent reporting on restaurant-platform economics has cited packaging as another meaningful per-order cost restaurants have to absorb when evaluating delivery profitability. Business Standard
  So do not confuse:
  Platform deduction
  with:
  Total delivery cost.
  The second number is what matters to restaurant profitability.

7. A ₹1,000 Order Is Not ₹1,000 of Restaurant Revenue

Here is a simplified illustration.
This is not a universal Swiggy or Zomato settlement because every restaurant's contract, discount participation, advertising and taxes differ.
Imagine:
Customer food order value: ₹1,000
Then assume, purely for illustration:
Platform commission/service fee at 22%: -₹220
GST on that service at 18%: -₹39.60
Restaurant-funded promotion: -₹100
Allocated advertising cost: -₹50
Payment/other applicable fee: -₹20
The restaurant is now at:
₹570.40
before considering the cost of making and fulfilling the food.
Now add:
Food cost: ₹300
Packaging: ₹30
You are left with:
₹240.40
And that ₹240.40 is still not profit.
The restaurant still needs to pay for:

• Kitchen staff

• Rent

• Electricity

• Gas

• Wastage

• Management

• Software

• Maintenance

• Licences

• Other overheads
  This is why a restaurant can generate impressive online sales and still struggle to make money.
  Again, the example above intentionally combines hypothetical charges to demonstrate the calculation. It should not be used as a claim that every Swiggy or Zomato order carries these exact charges.

8. Do Not Confuse Customer Platform Fees With Restaurant Commission

This is another common mistake.
A customer may see charges such as:

• Delivery fee

• Platform fee

• Other consumer-facing charges
  That does not automatically mean the restaurant receives that money or that those charges should simply be added to the restaurant's commission cost.
  Customer-side fees and merchant-side commercial arrangements are different parts of the platform model. For example, food-delivery platforms have increased consumer platform fees over time as another monetization lever. The Economic Times
  When calculating restaurant margin, use: Your own settlement statement
  not: The customer's checkout screen. The restaurant needs to understand exactly:
  What was the gross order value? What did the platform deduct? What did the restaurant fund? What was actually paid out?

9. The Bigger Problem Is Often the Effective Take Rate

The headline commission might say:
20% But imagine that after:

• Commission

• Advertising

• Restaurant-funded promotion

• Other applicable charges
  your business gives up ₹300 on a ₹1,000 order.
  Your effective platform-linked cost is much closer to:
  30%
  before food, packaging, staff, rent and other operating costs.
  This is why restaurants should calculate:

Gross Platform Sales

Total order value generated through the channel.

Total Platform-Linked Cost

Every applicable fee, advertising expense and restaurant-funded promotional amount associated with the channel.

Net Restaurant Realization

What the restaurant actually keeps before internal food and operating costs.

Contribution Margin

What remains after the variable costs required to fulfil those orders.
This is a much more useful picture.
Amello can help restaurant owners think in this direction: not just “How much did this channel sell?”, but “What value did this channel create?”

10. More Orders Can Actually Hide a Margin Problem

Consider two months.

Month A

1,000 orders
Healthy contribution per order.

Month B

1,500 orders
More advertising.
More discounts.
Lower contribution per order.
Month B looks much better in an orders dashboard.
But the restaurant may:

• Prepare 50% more food

• Need more labour

• Use more packaging

• Experience more operational pressure
  while producing surprisingly little incremental contribution.
  This is the danger of optimising only for:
  Order volume
  or:
  GMV
  Revenue growth and profitable growth are not the same thing.
  With Amello, restaurants should be able to connect sales trends with items, customers and marketing activity so growth decisions are not based on one headline metric.

11. Some Menu Items Are Better Suited to Aggregators Than Others

You do not necessarily need to treat the entire menu equally.
Suppose:
Dish A
Selling price: ₹300
Food cost: ₹120
Dish B
Selling price: ₹300
Food cost: ₹70
Before platform economics, Dish B already has much more room to absorb acquisition and delivery-related costs.
Restaurants should understand:

• Item revenue

• Item food cost

• Contribution

• Packaging requirement

• Delivery suitability

• Discount participation

• Customer demand
  This is where menu engineering becomes important.
  Amello can help restaurants understand item trends, bestsellers and slow movers so owners can identify which parts of the menu deserve more attention.
  Do not automatically push a bestseller if its delivery economics are poor.

12. Delivery and Dine-In Should Not Be Judged the Same Way

Delivery can have different economics from dine-in.
But dine-in also has costs that should not be ignored.
A dine-in guest consumes:

• Seating capacity

• Service labour

• Cleaning

• Crockery

• Physical restaurant infrastructure
  A delivery order may create:

• Platform commission

• Packaging

• Promotional costs

• Delivery-specific kitchen pressure
  So the analysis should not become:
  “Delivery has fees, therefore dine-in is always better.”
  Instead compare incremental contribution intelligently.
  If delivery allows the kitchen to generate additional orders during otherwise unused capacity, those orders may still be attractive even at lower percentage margins.
  If delivery overwhelms the kitchen during peak dine-in service and has poor contribution, the answer may be different. Amello helps restaurants look at channels in business context rather than assuming one channel is universally good or bad.

13. Avoid Solving Commission Pressure by Blindly Raising Online Prices

One natural reaction is:
“The platform charges 25%, so increase platform prices 25%.”
That sounds logical.
But it can create:

• Lower conversion

• Customer dissatisfaction

• Price inconsistencies

• Contractual issues depending on merchant terms

• Weaker competitiveness against nearby restaurants
  Business Standard has previously reported restaurants using differential pricing to offset commissions, while also noting contractual restrictions can apply. Business Standard
  So before changing pricing:

1. Check your agreement.

2. Understand customer price sensitivity.

3. Model the margin impact.

4. Understand competitor prices.

5. Check whether the item still converts.
   Pricing should be an economic decision, not an emotional response to commission.

14. Build Direct Customer Relationships Alongside Aggregators

The strongest restaurant strategy may not be:
Aggregator only
or:
Direct only.
It can be a healthy channel mix.
Aggregators can be powerful for discovery and convenience.
Direct channels can help the restaurant build a closer relationship with customers.
That could include:

• Website

• Direct ordering

• WhatsApp

• Google Business Profile

• Loyalty

• CRM

• Social media

• Phone ordering where operationally appropriate
  But restaurants should not violate platform contracts or improperly solicit platform customers.
  Instead, build legitimate direct demand through customers who discover or engage with the restaurant through its own channels.
  This is where Amello becomes particularly useful.
  Amello helps restaurants improve Google visibility, website opportunities, customer retention and marketing so the business does not depend on one discovery channel forever.

15. Improve Google Discovery to Reduce Dependence on Paid Marketplace Visibility

Customers already search:
“pizza near me”
“biryani delivery near me”
“best Chinese restaurant nearby”
A restaurant that gets discovered through Google may have another path to:

• Website

• Phone

• Directions

• Direct ordering

• Reservation
  This does not eliminate Swiggy or Zomato.
  It creates additional demand sources.
  Amello helps restaurants identify Google Business Profile gaps, local search opportunities and website improvements so customer acquisition is not concentrated entirely inside food-delivery marketplaces.
  That channel diversification can become strategically important as the restaurant grows.

16. Use Repeat Customers to Improve the Economics

Acquisition is expensive.
A customer who already knows your restaurant may be much easier to bring back.
Use your own legitimate customer relationships to build:

• Repeat visits

• Loyalty

• Relevant WhatsApp campaigns

• New menu launches

• Birthday or occasion marketing

• Customer reactivation
  This is where Amello can help restaurants understand:

• First-time customers

• Repeat customers

• Frequent customers

• High-value customers

• Inactive customers
  Instead of continuously buying another order through advertising, a restaurant can work on creating more lifetime value from customers it already has.

17. Do Not Cut Off Aggregators Before Understanding Customer Behaviour

Restaurant frustration with commissions is understandable.
In Bengaluru in 2026, restaurant bodies publicly raised concerns about commissions, discounts, ad fees and payout deductions and even threatened a platform boycott. Business Standard
But abruptly turning off a platform may not automatically improve profitability.
Ask:

• How many customers come exclusively through the platform?

• What percentage are incremental?

• Which hours depend on marketplace demand?

• Which menu items work well there?

• What happens to kitchen utilization without those orders?

• Can direct channels realistically replace the demand?
  A high-cost channel can still be valuable. A low-cost channel can still be useless if it generates no demand. The objective is not to minimize commission percentage.
  The objective is to maximize profitable restaurant growth.
  That is the type of decision Amello should help make clearer.

Use Amello to Understand Your Real Restaurant Economics

A restaurant owner should not need to mentally combine five different systems just to understand whether the business is growing. Sales sit in the POS. Delivery performance sits in marketplace dashboards. Customers sit somewhere else. Google sits somewhere else. Marketing sits somewhere else. That is where Amello comes in.

Amello Helps You Understand Sales

Amello can help surface changes in restaurant sales and order behaviour.

Amello Helps You Understand Menu Performance

Use Amello to understand bestsellers, slow movers and item trends rather than evaluating the delivery channel only at total-sales level.

Amello Helps You Understand Customers

Amello helps restaurants think about repeat, valuable and inactive customer cohorts.

Amello Helps Improve Discovery Outside Marketplaces

Google, local search, website, content and customer retention can all help diversify demand.

Amello Helps Turn a Problem Into an Action

Instead of:
“Zomato is expensive.”
the useful action might be:
“Stop promoting this low-contribution item.”
“Reduce restaurant-funded discounting on already strong weekend periods.”
“Reactivate high-value customers directly through an owned campaign.”
“Improve Google visibility for this local search.”
“Promote this stronger-margin bestseller.”
That is a much more useful conversation.

Build a Weekly Delivery Profitability Routine With Amello

Use Amello as part of a weekly restaurant review.

What Did Each Channel Sell?

Review Swiggy, Zomato, dine-in and other meaningful channels.

What Did We Actually Realise?

Look beyond GMV to settlements and applicable costs.

Which Items Generated the Orders?

Identify strong and weak menu economics.

How Much Did Promotions Cost?

Separate restaurant-funded discounts from genuine platform-funded offers.

How Much Did We Spend on Visibility?

Review advertising and promotional costs.

Which Customers Came Back?

Look at retention rather than treating every order as an isolated transaction.

What Should We Change Next?

Choose a specific action.
This creates a stronger Amello growth loop:
Measure → Understand → Prioritize → Act → Review.

A Simple Restaurant Platform Profitability Formula

For every delivery channel, start with Gross order value then subtract Platform fees and commissions Restaurant-funded discounts Applicable advertising allocation
Other applicable non-recoverable platform costs Then subtract direct fulfilment costs such as:
Food cost
Packaging
Other variable kitchen costs
What remains is much closer to the contribution generated by the channel.
Then compare that contribution with:

• Dine-in

• Direct orders

• Different times of day

• Different menu items

• Different campaigns
  This is significantly more useful than comparing gross revenue alone.

What Restaurant Owners Should Check in Their Swiggy and Zomato Statements

Every week or month, review:

• Gross order value

• Commission/service fee

• Tax applied to platform services

• Restaurant-funded discounts

• Platform-funded discounts

• Advertising charges

• Promotional charges

• Other deductions

• Cancellations

• Refunds or adjustments

• Net settlement

• Order count

• AOV
  Then reconcile that against your POS and accounting records.
  Zomato's published merchant terms explicitly provide for deductions from merchant settlement according to the applicable form and terms, reinforcing why restaurant owners should understand the individual commercial agreement rather than relying on a generic internet commission rate. Zomato

The Real Question Is Not “What Commission Am I Paying?”

The better questions are:
What percentage of platform GMV do I actually retain?
Which menu items remain profitable after delivery economics?
Which promotions create incremental contribution?
How much are we spending to acquire each marketplace order?
Are these customers incremental or would they have ordered directly anyway?
What percentage of our total demand depends on one platform?
Could Google, our website, CRM and repeat customers create a healthier channel mix?
Those questions reveal much more about restaurant health than commission percentage alone. And those are exactly the kinds of growth questions Amello is designed to make easier to answer.

Swiggy and Zomato Should Be Growth Channels, Not Your Entire Growth Strategy

Delivery platforms have helped create enormous convenience for customers and discovery for restaurants.
That value should not be ignored.
But convenience has economics.
Restaurants need to know those economics clearly.
A business can have:
More orders
More GMV
More platform visibility
and still have:
weaker margins.
That is why restaurant owners should stop evaluating Swiggy and Zomato purely by how much revenue they generate.
Evaluate:
Contribution.
Customer quality.
Menu economics.
Incrementality.
Channel dependence.
Then build owned discovery and retention alongside marketplaces.
Amello helps restaurants connect those growth signals so the question changes from:
“How many orders did Swiggy and Zomato give us?”
to: “Which orders are actually helping us build a stronger restaurant?”
That is the number worth optimizing.

Frequently Asked Questions

How Much Commission Do Swiggy and Zomato Charge Restaurants?

There is no universal rate. Commercial terms vary by restaurant, agreement and services used. Recent industry reporting has cited broad ranges of roughly 15%–30% for base commissions in some arrangements, while other fees, ads, discounts and applicable charges can change the effective economics. Business Standard

Is the Commission the Only Cost of Selling on Swiggy or Zomato?

No. Depending on the restaurant's specific agreement and choices, additional economics can include taxes on platform services, restaurant-funded promotions, advertising, payment-related fees, other contractual charges and the restaurant's own delivery packaging costs. Business Standard

Do Swiggy and Zomato Really Take 30% of Every Order?

Not necessarily. Rates vary. A restaurant may have a lower or higher commercial arrangement, and effective cost can differ depending on advertising and promotions. Use your own merchant agreement and settlement statement rather than assuming a universal percentage.

Are Swiggy and Zomato Orders Unprofitable?

Not automatically. Some restaurants and menu items can generate attractive incremental contribution through delivery platforms. Others may have weak economics. The answer depends on commission, food cost, packaging, discounting, advertising, pricing, utilization and order mix.

Should Restaurants Stop Using Swiggy and Zomato?

Not simply because commissions are high. Platforms can provide meaningful discovery and incremental demand. Restaurants should calculate channel contribution and dependence before making that decision.

How Can Amello Help Restaurants Reduce Platform Dependence?

Amello helps restaurants understand sales, menu performance, customer cohorts, Google visibility, competitors, content and marketing opportunities so owners can build growth across multiple channels rather than depending entirely on aggregator demand.