Zepto has made quick commerce part of everyday shopping in India. Customers can use its app to order groceries, fruits, vegetables, electronics, beauty products, household supplies, toys, fashion items and ready-to-eat food for delivery within minutes.
The company’s business is built around a network of small fulfilment centres called dark stores. These stores are located close to residential neighbourhoods and are organised for fast online order processing rather than walk-in shopping.
Zepto mainly makes money through commissions on products sold by merchant partners, product procurement and distribution, delivery and logistics charges, and advertising. Although its revenue has grown rapidly, the company continues to spend heavily on stores, discounts, delivery and customer acquisition.
Zepto Company Quick Overview
| Particular | Details |
| Company name | Zepto Limited |
| Platform operator | Zepto Marketplace Private Limited |
| Founded | 2021 |
| Founders | Aadit Palicha and Kaivalya Vohra |
| Corporate office | Bengaluru, Karnataka |
| CEO | Aadit Palicha |
| Industry | Quick commerce and online retail |
| Core business model | Marketplace, supply-chain and rapid-delivery model |
| Main categories | Groceries, food, electronics, beauty, fashion and household products |
| FY2026 dark stores | 1,139 |
| FY2026 warehouses | 75 |
| Annual transacting users | 47.97 million |
| FY2026 revenue from operations | ₹22,624 crore |
| FY2026 net loss | ₹5,905 crore |
Zepto had 1,139 dark stores and 75 warehouses as of March 31, 2026. It served 47.97 million annual transacting users and processed more than 2.3 million orders per day during the final quarter of FY2026.
What Is the Zepto Business Model?
Zepto follows a quick-commerce marketplace model supported by its own fulfilment and logistics infrastructure.
Third-party merchant partners list products on the platform. When a customer places an order, it is processed through a nearby dark store operated by Zepto and delivered by a last-mile delivery partner.
Zepto does not legally own every product displayed on its consumer marketplace. It works as a facilitator between customers and participating sellers. However, the wider group also purchases goods from brands and supplies them to wholesalers and retailers through its procurement and distribution business.
This creates a hybrid model combining marketplace commissions, supply-chain revenue and service fees.
How Does Zepto Make Money?
1. Commissions from Merchant Partners
Commissions on product sales are one of Zepto’s main sources of income.
Merchant partners use Zepto’s platform, dark stores, customer traffic and fulfilment system to sell products. When an order is completed, the seller receives its share of the product value, while Zepto earns an agreed commission.
The commission can vary according to the product category, seller agreement, order volume and services provided. Categories with higher margins may allow Zepto to earn more than basic grocery staples.
A large product selection also increases the possibility that customers will place bigger orders. Zepto now offers more than 46,600 products across several categories.
2. Product Procurement and Distribution
Zepto also earns from purchasing products from brands and supplying them to wholesalers, retailers and merchant partners.
In this business, the company makes money from the difference between the price at which it obtains a product and the price at which it sells or distributes it.
Product sales generated approximately ₹17,588 crore in FY2026, representing around 78% of Zepto’s operating revenue. This was the company’s largest reported revenue stream.
However, the complete selling price is not profit. Zepto must first deduct the cost of purchasing the products, storage, wastage, transportation and related expenses.
3. Delivery and Last-Mile Logistics Fees
Customers may see delivery, late-night delivery, handling or other service charges at checkout. These charges depend on factors such as location, order value, demand and the services selected.
Zepto also provides logistics and fulfilment services connected with merchant orders. Its fees can cover picking, packing, handling, warehousing and last-mile delivery.
Revenue from warehousing, packaging and last-mile services reached approximately ₹2,780 crore in FY2026.
These fees help recover delivery costs, but they do not always cover the complete expense of processing a small order.
4. Platform and Handling Charges
Zepto may charge users a platform or handling fee in addition to the product price.
This supports the technology, payment system, customer service and fulfilment operations required to process an order. Zepto’s consumer terms allow it to charge separately for platform services, product handling and last-mile delivery.
Platform-service revenue reached approximately ₹564 crore during FY2026.
A small charge on each order can become a meaningful revenue source when the platform handles millions of daily transactions.
5. Advertising and Sponsored Product Placement
Brands pay Zepto to improve their visibility inside the app. Sponsored products may appear in search results, category pages, recommendations and promotional banners.
Advertising is valuable because customers generally open Zepto with the intention to purchase something immediately. A snack, beverage or beauty brand can promote its product to shoppers at the point of purchase.
Brands may also pay for new-product launches, festival campaigns, sampling programs and targeted promotions.
Zepto’s advertising revenue increased to approximately ₹1,636 crore in FY2026, making it one of the company’s fastest-growing income streams.
Advertising can provide higher margins than physical product sales because it does not carry the same procurement or delivery costs.
6. Zepto Café Orders
Zepto Café offers prepared food and beverages such as coffee, tea, sandwiches, snacks and meals.
The company can earn through product margins, merchant commissions, packaging and delivery services connected with these orders. Prepared food may also encourage customers to use the app at times when they do not need groceries.
Café orders help increase ordering frequency, but this business requires careful management of food preparation, quality, freshness and delivery times.
7. Membership and Customer-Loyalty Programs
Zepto has offered programs such as Zepto Pass, which provide eligible users with benefits such as reduced delivery charges or special offers.
When a paid membership is available, Zepto can collect a subscription fee in advance. The program may also encourage customers to place more orders because members want to use their benefits.
Membership fees are not among Zepto’s largest separately disclosed revenue streams. Their greater value may be improving customer retention and ordering frequency.
Gross Order Value Is Not Zepto’s Profit
The total value of products ordered through Zepto is much larger than the amount the company keeps as profit.
A substantial part of every order goes towards product costs, seller payments, taxes and delivery expenses. Zepto’s real earnings depend on what remains after paying all these costs.
This distinction is important because rapidly increasing order value does not automatically mean the company is profitable.
Major Costs in the Zepto Business Model
Product procurement was Zepto’s largest expense in FY2026, reaching approximately ₹18,199 crore.
Other major costs included:
- Delivery and handling expenses of approximately ₹3,046 crore
- Dark-store and fulfilment expenses of around ₹2,150 crore
- Employee expenses of approximately ₹1,785 crore
- Advertising and promotional costs of around ₹1,389 crore
- Technology, software, packaging and warehouse expenses
Zepto’s total expenses increased to approximately ₹29,027 crore during FY2026 as it continued expanding its fulfilment network.
Latest Financial Performance
Zepto’s revenue from operations increased from approximately ₹11,110 crore in FY2025 to ₹22,624 crore in FY2026.
Despite this growth, its net loss widened from approximately ₹4,700 crore to ₹5,905 crore. Higher product procurement, delivery, store and employee expenses contributed to the loss.
The company improved some operating measures. Orders handled per dark store per day reached 2,140 in Q4 FY2026, indicating that individual stores were processing greater volume.
Why the Zepto Business Model Can Work
The model becomes more efficient when one dark store handles a large number of orders within a small delivery area.
Higher order density allows delivery partners to travel shorter distances. Rent, employees and technology costs can also be divided across more transactions.
Advertising offers another important opportunity. As product sales and customer traffic increase, brands may spend more to gain visibility on the platform.
Expansion into electronics, beauty, fashion and other non-grocery categories can also improve average order values and margins.
Challenges Facing Zepto
Quick commerce is expensive to operate. Customers expect fast delivery, low prices, reliable product availability and attractive discounts at the same time.
Zepto also competes with Blinkit, Swiggy Instamart, BigBasket, Flipkart Minutes and other delivery platforms. Competition can increase discounts and advertising expenses.
Another challenge is product wastage. Fruits, vegetables, dairy products and prepared food have limited shelf lives. Poor demand forecasting can lead to losses.
The company must also maintain hygiene, food safety and product quality across more than a thousand dark stores.
Conclusion
Zepto makes money through merchant commissions, product procurement and distribution, delivery services, platform charges and advertising. Zepto Café and membership programs provide additional opportunities to increase customer spending and ordering frequency.
Its long-term success will depend on increasing the number of orders handled by each dark store while controlling procurement, delivery, discount and marketing costs. Rapid revenue growth has established Zepto as a major quick-commerce platform, but sustainable profitability remains its most important challenge.
FAQs
Q: Can customers visit a Zepto dark store?
A: Generally, no. Dark stores are designed for online order fulfilment rather than normal walk-in shopping.
Q: Does Zepto decide the price of every product?
A: Not necessarily. Prices may be set by merchant partners or determined under supply arrangements. Zepto can also provide promotions and discounts according to applicable terms.
Q: Are delivery partners regular Zepto employees?
A: Many last-mile deliveries are completed through independent delivery partners or third-party service providers rather than permanent employees.
Q: Why can the same product have different prices in different locations?
A: Prices may vary because of seller arrangements, local inventory, taxes, demand, availability and city-level promotions.
Q: Does Zepto guarantee delivery in exactly ten minutes?
A: No. The delivery time shown is an estimate. Distance, traffic, weather, order volume and product availability can affect the actual delivery time.
