Dunzo’s partner stores in Bengaluru go temporarily offline following non-payment of dues

Dunzo’s partner stores have not received clear communication from Dunzo about the timeline of payment for orders fulfilled between December 4 and December 10, according to a person in the know.

Dunzo’s partner stores in Bengaluru go temporarily offline following non-payment of dues

Friday December 15, 2023,

4 min Read

Some of Dunzo's partner stores in Bengaluru went offline temporarily on Friday after the Reliance Retail-backed company delayed payments of grocery orders fulfilled last week.

The quick commerce company has not paid the dues to at least five partner stores from December 4 to December 10, including outlets belonging to MK Retail and Easy Bazar in Horamavu, Indiranagar, and HSR Layout, among other areas, according to a person aware of the development.

Dunzo has tie-ups with nearly 10 such stores in Bengaluru. These stores are marked offline on the Dunzo app as well.

The store owners have not received communication from Dunzo about the extent of the delay, the source told YourStory on the condition of anonymity. “If the delay goes on, the partner stores will not resume servicing any orders from Dunzo,” they added.

YourStory has reached out to Dunzo for a comment on the development. The story will be updated once the response comes in.

The payment delay took place last week as well, resulting in halting of operations for nearly four days, according to the person quoted above. The Bengaluru-based company had informed store owners that payments for the week of November 27 to December 3 would be delayed by a few days, given the company’s cash crisis, this person noted.

However, the dues were paid in two instalments by December 9, which enabled the stores to continue fulfilling orders, they added.

The payments for last week were supposed to be paid on December 11 as all dues are usually cleared on Monday every week.

The repeated delays have alarmed partner store owners as they are aware of Dunzo’s problems and want to take control of the situation before it gets out of hand, the source said.

Earlier in August, YourStory had reported that Dunzo was scaling down its quick commerce operations under Dunzo Daily massively to cut down cash-burning propositions and focus on more lucrative verticals. A Dunzo spokesperson later confirmed that the company is in the process of moving to a partner store format.

Following the closure of most of its dark stores across major cities, including Bengaluru, the firm partnered with a host of offline retail stores such as MK Retail, Easy Bazar, Pristine Supermarket, and Deepa Retail to service quick commerce orders.

Under this system, Dunzo would enable consumers to place orders through the app, which would be fulfilled by these partner stores. The company would then charge an 8-10% commission for every order and make the remaining payment to the partner store every week, the source said.

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Some of the dark stores in Bengaluru—including Indiranagar, Richmond Town, and Koramangala—were taken over by Bryt Bazaar.

The Kabeer Biswas-led firm also deferred the payment of employees' salaries for November. The company informed employees about this over email earlier this week. The salaries are expected to be paid by December 15.

Moneycontrol was the first to report the development.

The on-demand convenience platform has delayed salary payments several times in the past, noting that it is gearing up to raise additional funding to fulfil payment obligations. Most recently, it informed employees that it has signed up with payroll financing firm OneTap to disburse salaries. Final settlements to former employees are likely to be paid only by February 2024.

Dunzo had also promised employees in the email that additional funding from investors would be wired by the following week, which would enable it to pay salaries for November.

“As this is based on external factors, we would recommend members to plan for a worst-case timeline of Dec 15, 2023. We will continue to put our best efforts to find other alternatives as well. Regret the delay and request your continued support,” Dunzo had told employees.

Edited by Swetha Kannan