Finance Formula • Published on September 04, 2026 • Last updated September 04, 2026
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Gross menu price of all items in customer order
Packaging fee collected from customer by restaurant
Merchant funded portion of promotional discounts and coupon codes
Commission charged by Swiggy/Zomato (typically 18%–28% + 18% GST)
Payment gateway processing fee (typically 1.5%–2% + 18% GST)
18% GST on platform services plus 5% GST collected on restaurant food orders
Cost of raw food ingredients and direct food preparation costs (typically 28%–38%)
Allocated share of kitchen rent, chef wages, gas, electricity, and packaging materials
Online food delivery aggregator platforms like Swiggy and Zomato deduct multiple service charges before releasing weekly merchant payouts.
These deductions include base platform commissions, 18% GST on aggregator commission and payment gateway fees, Section 194O TDS (1%), Section 52 TCS (0.5%–1%), and customer-funded discount splits.
To determine true cloud kitchen or dine-in restaurant delivery profitability, owners must reconcile gross order value against raw material cost of goods sold (COGS) and fixed kitchen operational overheads.
Aggregators deduct base commission (18%–28%), 18% GST on commission, 1.8%–2% payment gateway charges, 1% TDS, 0.5% TCS, customer discount shares, and packaging fees. Combined, platform deductions frequently total 28% to 35% of order value.
Under Section 9(5) of the CGST Act, e-commerce operators (Swiggy and Zomato) are liable to pay 5% GST directly to the government on restaurant services delivered through their platform. Restaurants cannot claim Input Tax Credit (ITC) against this 5% rate.
Restaurants can optimize delivery margins by: (1) Setting higher delivery-specific menu prices (10%–20% above dine-in), (2) Creating high-margin combo meals, (3) Capping discount promotions at max ₹40–₹50, and (4) Encouraging repeat customers to order through direct WhatsApp or website ordering.
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