Rapido has already hogged the news headlines with its food delivery venture, “Ownly,” aiming to challenge the Zomato-Swiggy duopoly.
With a pilot launching in Bengaluru soon, Rapido’s Ownly is luring in restaurants and consumers with two key value propositions: a flat-fee structure and transparent meal pricing.
This hints at a potential shake-up. But is it a walk in the park or a walk into the storm? Why has no other player been able to pull this venture off successfully yet?
In this article, I’ve answered these questions by explaining what’s driving Rapido Ownly’s proposed model and what roadblocks it can stumble upon.
Read the analysis!
Firstly, Why Earlier Ride-Hailing Biz Failed?
Before Rapido, Ola and Uber attempted to shake the Swiggy-Zomato duopoly with Ola Café (acquired Foodpanda India later) and Uber Eats India, respectively. Additionally, Amazon Food and the government-backed Open Network for Digital Commerce (ONDC) faced the same fate.
Ola Café, Amazon Food, and Uber Eats India fizzled out within a few years, with Zomato buying out the latter.
Most of these haven’t been able to grow due to limited restaurant selection, inefficient last-mile logistics, bad customer experience, and operational complexities.
While Ola has partnered with ONDC—its food delivery service “Ola Dash” now runs on the ONDC platform—it’s yet to match the success of Zomato and Swiggy.
The Rapido Advantage
Restaurant-Friendly Three-Tier Pricing Structure
Rapido has categorized its delivery fees into three distinct layers:
- Order value over ₹400: Flat delivery fee of ₹59 (₹50 + 18% GST) to be paid by partner restaurants.
- Order value ₹100-400: Flat delivery fee of ₹29.50 (₹25 + 18% GST) to be paid by partner restaurants.
- Order value below ₹100: Cross-subsidizing—partner restaurants will pay ₹11.80 (₹10 + 18% GST), customers will pay ₹23.60 (₹20 + 18% GST).
Now, let’s compare this flat-fee model to Zomato-Swiggy’s commission-based one.
Firstly, these two incumbents charge customers an additional platform fee of ₹10/order, which, with GST, totals ₹11.80.
Then, they extract 16-30% take rates of the order value. For example, a ₹500 food order on Swiggy or Zomato may attract ₹80-150 from partner restaurants. Rapido’s delivery fee will stay at ₹59.
The difference narrows on a ₹300 food order, with Zomato- or Swiggy-partnered restaurateurs footing ₹48-90. Rapido will charge ₹29.50 for the same order value.
Strong Last-Mile Delivery Backbone
Rapido boasts a ~40-lakh rider network (captains) that completes 6 crore monthly rides and over 30 lakh daily rides—a major credit goes to the two-wheelers (2W).
The ride-hailing unicorn plans to smartly redirect idle rider time to food delivery without fresh capital expenditure (CapEx). Moreover, the existing logistics infrastructure can speed up rollouts in new pin codes and potentially reduce delivery times in jam-packed urban areas.
As a sweetener, Rapido can expand its restaurant pool by targeting lower AOV eateries in tier 2 and 3 cities. These restaurants haven’t been profitable for Swiggy and Zomato.
Furthermore, Rapido’s previous experience with ONDC in food delivery works in its favor. Riders’ income will likely shoot as order volume increases. A dedicated captain’s app will loop ride, parcel, and food delivery orders into a single platform, with intelligent algorithms assigning jobs to maximize earnings and minimize travel distance.
The Cross-Sell Edge
Thanks to its massive ride-hailing user base, Rapido doesn’t need to splurge cash on bringing in new users to its food delivery app, Ownly. Instead, it can cross-sell to its existing customers by promoting Ownly within its own framework—in-app banners, SMS, and emails. Moreover, people with positive ride experiences will more likely give Ownly a test drive.
This means minimal-to-zero burning of millions on ads, influencer marketing, or discount wars to lure first-timers.
The result? Lower customer acquisition cost (CAC) and higher customer lifetime value (CLV).
But There’s A Flip Side To That Coin
Pricing Edge Wanes For Sub-100 INR Orders
When it comes to the delivery fee, Rapido trumps Zomato and Swiggy for food orders totaling at least ₹100. But for orders under ₹100, let’s say ₹70, Rapido loses its edge to the established players.
Let’s see how.
- Rapido: Combined fee of ₹35.40
- Zomato & Swiggy: ₹11-21 commission
At the lowest order tiers, the incumbents come out as the winners.
Signing Up Lakhs of Restaurants is a Steep Trek
Food delivery is operationally challenging, with only 10% of India’s gross order value (GOV) coming from organized quick-service restaurants (QSR) and the remaining from smaller eateries. So, Rapido Ownly must onboard thousands of mom-and-pop restaurants to scale up.
That’s an operational and logistical nightmare in a fragmented market.
Plus, on the supply side, Zomato and Swiggy have a firmer grip than their challengers. As of Q4 FY25, the Deepinder Goyal-led food delivery platform hosted about 314,000 monthly restaurant partners, followed by Swiggy’s 252,000.
This gives the two giants a clear edge in terms of scale and reach. For a newcomer like Rapido Ownly, inking deals with about 3 lakh restaurants to build supply is an enormous hurdle to jump over.
Shallow Profit Margins
In India, the AOV is ₹350–500, attracting ₹50–70 pre-order delivery costs. Rapido’s proposed take rates would hurt its profitability and, consequently, leave zero scope for further expansion and operational expenses (OpEx).
Rapido is still in the red and burns $4-5 Mn cash every month. So, potential low margins and bleak reinvestments in operations and expansions threaten an increased cash burn as it ventures into online food delivery.
Zomato, for instance, has priced meals 30-35% higher than dine-in rates on average. This makes its total customer costs, including delivery and platform charges, among the highest across continents.
Still, Zomato doesn’t enjoy the gravy train. It earns a flat 4.4% EBITDA, showing how thin profit margins already are, even at scale.
Therefore, Rapido Ownly will feel the pressure to increase take rates from partner restaurants, which can dilute its initial advantage.
Keeping Customers Happy Won’t Be That Easy
Zomato and Swiggy are doubling down on superfast food delivery with platforms, Bolt and Quick, respectively, to bring down delivery time to below 30 minutes. Both the giants are aiming for even faster food delivery.
Rapido’s riders will have to serve two high-priority demand segments—passengers and consumers—if it sticks to using its existing fleet. The mobility company needs to carve out a dedicated rider fleet to soak up the high-pressure, sub-30-minute food delivery. Else, the food might reach customers late due to rider allocation complexities, thus frustrating them.
So, while ₹25-50 per food order sounds great for restaurateurs, will customers switch for (slightly) affordable meals if delivery isn’t that fast?
Furthermore, Swiggy and Zomato have earned loyal customers through discounts, loyalty programs, and their respective quick-commerce services like Instamart and Blinkit. Rapido Ownly’s “earned visibility” model, where restaurant ratings precede paid ads, may not compete against incumbents’ aggressive marketing.
Zomato-Swiggy Won’t Just Sit and Watch
Zomato and Swiggy have already poured $2–3 Bn into building robust food delivery infrastructure. They now boast deep restaurant networks, strong and loyal customer bases, and a brand image that won’t fade anytime soon.
Sure, Rapido may onboard previously untapped restaurants, especially low AOV eateries in tier 2 and 3 cities, onto its platform. This will expand the overall food delivery market rather than poach the customer base of the incumbents.
Needless to say, Zomato and Swiggy will likely double down on what they do best: faster deliveries, hyperlocal dominance, and deeper discounts.
Is Rapido Biting More Than It Can Chew?
Rapido has entered the food delivery fight club at a time when restaurant owners are fed up with the unsustainable cost structure of Zomato and Swiggy. Ownly’s arrival has spiced up the competition and may compel market heavyweights to rethink their pricing models.
That said, real disruption will require more than low commissions and fleet reallocation.
Until then, Zomato and Swiggy’s structural advantages—dense restaurant networks, loyal customer bases, and operational muscle—remain intact.
It’s a hyper-competitive platform economy and India’s food delivery industry has been unforgiving.
Will Rapido trigger material shifts in the market share or is it just an exaggeration?
Only time will tell.