New Delhi: In an unprecedented U-turn, Zomato has pulled out of the liquor delivery business that started last year due to the nationwide lockdown introduced by the central government.
According to a report by Inc42, the major in grocery delivery left the store due to scalability issues and poor unit economy. The Gurugram-based company decided to cease its spirits delivery business in January 2021.
A company spokesman confirmed the report and told the media company: “We have started Zomato wines in cooperation with various state governments to ensure safe and responsible delivery during the lockdown. Earlier this year, we decided to end the service as restrictions continued to ease and local laws in these states were being complied with. “
Authorities in Jharkhand, West Bengal and Odisha had allowed Zomato and his rival Swiggy to deliver alcohol in the States to curb the hustle and bustle in liquor stores. While Zomato is out of business, Swiggy is still supplying alcohol in some Indian states.
Zomato is currently preparing for its IPO, which is expected to take place in late 2021. The company is currently focused on profitability and is therefore leaving the business with high cash burn and poor unit economy.
In addition to delivering alcohol, Zomato had started delivering groceries last year. The company has also stopped supplying food to focus entirely on the food delivery business.
