July 18, 2024

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Blinkit delivery workers protest in Delhi-NCR over changes in pay structure, ET Retail

4 min read
Blinkit delivery workers protest in Delhi-NCR over changes in pay structure, ET Retail

Hundreds of delivery partners working with Zomato-owned quick commerce platform Blinkit in Delhi-NCR went on a strike on Wednesday, protesting against a renewed fee structure that they say will reduce their income, disrupting services at some locations.

“The protests are primarily happening at dark stores situated in Gurgaon, Faridabad, Noida, and some parts of Delhi,” a person aware of the development said.

Blinkit implemented the new rate structure this month across several dark stores, but not all of them. “A full rollout across the remainder of the stores is expected over the next few days,” said the person.

A Blinkit spokesperson confirmed that the firm has “introduced a new payout structure for our partners that compensates them based on their effort to deliver an order”, but added that it is an “opt-in exercise”.

People aware of the development said delivery partners will now be paid a minimum fee of Rs 15 per delivery, down from Rs 25 earlier.

In addition, under the new structure, riders will be paid a per km fee depending on which time of the day the delivery is being made. The day has been broken down into seven time slots. For example, some stores in South Delhi, where the new system has been implemented, delivery workers will be paid in the range of Rs 10-14 per km.

In the previous system, riders were paid an additional Rs 7 per delivery during peak hours, they said. Peak hours are 6 am to 12 pm, and 6 pm to 12 am.

A Delhi-based Blinkit delivery partner told ET that the new structure results in a reduction of Rs 200-250 per day in their payout because most dark stores operate within a radius of 2 km.

“The per-delivery fee till a few months ago used to be Rs 50, and was reduced to Rs 25. Now it is being reduced further to Rs 15,” the person said. “For some younger delivery boys who have just signed on to the platform, the new payout structure may work, but for those who have been doing it for some time, the change means a further reduction in earnings.”

A Blinkit spokesperson, however, said, “We believe this is a positive step for our partner ecosystem, as it is fair to them and our customers.” Blinkit teams are “on the ground to answer any questions from the partners”, the person said.

“Although some locations have experienced disruptions, we are actively engaging with our partners to get the stores back up and running for our customers,” the spokesperson said in a statement.

The development was first reported by news portal The Morning Context.

This is the latest in a series of protests by delivery workers post Covid-19. ET reported in July last year that Swiggy has been facing delivery worker strikes across metro cities amid discussions about the industry’s poor compensations and lack of social security net.

Shaik Salauddin, national general secretary of Indian Federation of App-based Transport Workers Union, told ET that the incentives have been dropping steadily across all grocery delivery apps since the pandemic started receding.

He said delivery workers are bearing the brunt of the companies’ attempts at improving their profitability.

Quick-commerce headwinds

The changes to Blinkit’s payment structure comes at a time when the quick commerce industry is seeing a slowdown in terms of new user addition amid a tough funding environment.

Companies in the space have been laying off employees. While Swiggy has laid off over 380 employees across all its businesses, Reliance Retail-backed Dunzo has laid off about 30%, or about 300 employees, amid a shift in its business model, as ET reported on April 6.

ET had reported on January 5 that Swiggy Instamart is seeing a slowdown in new user addition after crossing the 300,000 mark.

Industry executives said beyond the top cities, which have high population density, it is difficult for dark stores to turn profitable.

Investors are also shying away from investing in high-cash burn businesses amid tightening macroeconomic conditions.

While the GMV (gross merchandise value) growth was driven by new users in 2021 and early 2022, quick commerce companies are now trying to sell more products to existing customers. ET reported on December 20 last year that quick commerce companies were nudging users to increase order sizes in an attempt to improve unit economics.

Despite attempts, Blinkit saw its average order value drop in the quarter ended December 2022. The Gurgaon-based company’s GMV rose 18% quarter on quarter to Rs 1,749 crore, whereas its revenue jumped 27% sequentially to Rs 301 crore.

Despite its average order value dropping from Rs 568 the previous quarter to Rs 553 in the December quarter, every other key metric – total order, average monthly transacting customers, and average gross order value per day per dark store – had increased.

  • Published On Apr 13, 2023 at 08:00 AM IST

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