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Petrol Diesel Price Hike Impact: ’10-Minute Speed ​​Delivery’ is available everywhere in almost every household across the country. So if you need anything, you don’t need to leave the house. In few minutes our work becomes easy and simple. But now you have to pay more for this simple task. Rising prices of petrol and diesel are now likely to affect these companies as well. Recently, petrol and diesel prices have recorded an increase of around Rs 3 per litre. So it will have an adverse effect on these services as well.

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According to a report by ‘Elara Capital’, the rise in prices is due to geopolitical tensions and rising crude oil prices. This situation will put pressure on Delivery Partners earnings and may force the respective platforms to increase their operating expenses.

Impact of fuel price hike on operations

In the ‘quick commerce’ sector, the average cost of delivery is ₹35–50 per order; Whereas in Food Delivery sector this cost is generally between ₹55-60. According to a report, Zomato The average cost of delivery for is approximately ₹45 per order, while for ‘Swiggy’ it is ₹55 per order. Fuel generally accounts for 20% of the total cost of distribution. This means that the fuel cost per order is around ₹9–10.

In the current scenario, a 4% hike in fuel prices would result in an additional burden of ₹0.44 per order. If fuel prices increase further i.e. by ₹10 per litre, the impact of this increase may reach ₹1 to ₹1.2 per order. If this increased cost of distribution is not passed on to consumers, it is likely to impact companies’ earnings by 4% to 12%.
Both Blinkit and Swiggy rely on the food delivery and ‘quick commerce’ sectors. In FY 2027, Eternal is estimated to receive approximately 2.7 billion orders, while Swiggy is expected to receive 1.4 billion orders. This could have a more significant impact on Swiggy; Because currently this company is on the way to reach the position of ‘break-even’ i.e. neither profit nor loss in the ‘quick commerce’ segment.

What effect on Eternal and Swiggy?

On the other hand, the company ‘Eternal’ is considered to be in a more favorable position. Its greater expansion, higher advertising revenue and higher-end customer base will enable it to meet rising costs. Companies will take various measures to manage these additional costs; Some of these costs will be passed on to consumers in the form of increased fees, some will be borne by the company itself, and the rest will be offset by pressure on the earnings of its delivery partners.

Impact on customers and delivery personnel

Due to rising costs, the facility of ’10 minutes delivery’ may become more expensive for consumers. As a result, companies may decide to increase delivery charges or service charges. As gig workers’ earnings are affected, they may demand more pay; Which in turn will affect the entire working system.
But according to ‘Elara Capital’, this situation will come under control after some time. From a long-term perspective, companies can meet this challenge by increasing their operational efficiency, increasing the use of electric vehicles and implementing better planning strategies. Rising fuel prices have now emerged as a new challenge for the ‘quick commerce’ industry.

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