Zomato forays into Logistics with ‘Xtreme’ Delivery service

Food aggregator Zomato has introduced a new service called Xtreme, which enables merchants to send and receive small parcels. This move is aimed at diversifying the company’s revenue streams and leveraging its extensive network of delivery partners.

The offering was in a pilot phase and intended to launch a white-label logistics service, competing with companies like Shadowfax, Loadshare, and Dunzo.

Xtreme streamlines the delivery process, making it easy for merchants to send packages to their customers, whether they are small shops or large retailers. Zomato already has over 3 lakh delivery partners associated with Xtreme, and it offers live tracking for shipments, similar to its food delivery service.

Merchants can use Xtreme to send intra-city packages weighing up to 10 kilograms, with prices starting at Rs 35, as mentioned on Zomato’s banner.

As of now, the Xtreme app is available exclusively for Android users and is not yet available on Apple’s App Store. It remains uncertain whether Zomato will release a version for Apple users.

Zomato’s competitor, Swiggy, also operates a hyperlocal delivery service called Swiggy Genie, which allows both businesses and customers to send and receive packages.

With the launch of Xtreme, Zomato entered into competition with Dunzo’s B2B arm, Dunzo for Business (D4B), LoadShare, Wefast, Blowhorn, and several others. Additionally, companies like Tata 1mg have been utilizing Zomato’s B2B services for last-mile deliveries.

This launch coincides with Zomato’s financial performance, as it reported a net profit of Rs 2 crore in Q1FY24, with revenues of Rs 2,416 crore, representing a 70.9 percent increase from the previous year. The demand growth recovered thanks to cooling inflation and the strength of Zomato’s loyalty program.