Zepto’s sustainability in question as suppliers flag payment delays
There’s a reason why vendors hesitate to trust startups, the intense media glaze notwithstanding. Started during the height of the work-from-home trend during the pandemic, Zepto had managed to silence critics with its 10 minute delivery service. Not to fall behind, food delivery and ecommerce majors including Zomato, Swiggy, JioMart and Flipkart also jumping into the fray.
After the e-commerce boom, venture capitalists queued up to invest in a slice of the quick commerce hype, with Zepto’s funding round getting ‘oversubscribed’ just like IPOs do.
Flush with funds, Zepto managed to corner about 29% of the quick commerce segment, as the convenience of getting groceries delivered started gaining popularity even in Tier II and III towns.
Though Zepto has managed to expand the reach of FMCG products to an all-India level, its breakneck speed of expansion and slow response to delayed payments has increased customer complaints.
A Reddit discussion has gone viral a few days ago, where a Reddior named CapitalEffective2939’s post explained his views about Zepto’s delayed payments and lack of accountability.
Zepto is a parasite feeding on vendors, brands, and staff – it’s a ticking time bomb and no one’s getting paid.
byu/CapitalEffective2939 inStartUpIndia
The post, with more than 1800 upvotes and 125 comments, explains the dark side of quick commerce and how its ‘growth-at-any-cost’ mindset can leave people high and dry. Even though the posts explains how Zepto has intentionally halted payments with vague responses and no accountability, they are forced to continue supplying to them due to the growth in numbers, as someone pointed out to the Redditor in question.
‘Yeah, we can’t just pull the plug on supplying them overnight .we’re playing a numbers game here. The brand I supply is actually doing solid numbers pan-India on quick commerce and showing consistent MoM growth. Sure, the growth in my city isn’t that impressive, but still , cutting off supplies now would tank the sales figures. That only opens the door for competing brands to scale while we sit on the sidelines.
the brand has explicitly told me not to hold supplies – they’ve assured the dues will be cleared soon. If smaller vendors like me start playing hardball, it’s not going to shake the system. It’ll just give more shelf space to competitors. The only way holding supply makes an actual dent is if giants like HUL, Parle, or Nestlé join the boycott. Otherwise, we’re just burning our own bridges while the platform barely feels a scratch.’
This shows the dilemma small suppliers face when dealing with Zepto, even as other cash-burning quick commerce companies fulfill their payment responsibilities.
Earlier, Zepto’s 23-year-old co-founder Aadit Palicha posted a long response to Commerce Minister Piyush Goyal’s comments at the Startup Mahakumbh, where he complained about the lack of research depth in Indian startups. “ We can’t be content churning out delivery boys and girls” he said.
Will you consider a response to this Reddit threat Aadit? We’re all eagerly awaiting your response.
<p>The post Zepto’s sustainability in question as suppliers flag payment delays first appeared on Hello Entrepreneurs.</p>
