Glovo To Cease Operations In Ghana After Investing $3.7 Million In Two Years!

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TLDR:

• Glovo, a food delivery platform, will cease operations in Ghana on May 10, 2024 due to profitability challenges.

• The company will focus on other African markets like Morocco, Uganda, Kenya, Côte d’Ivoire, and Nigeria.

• Ghana’s online food delivery market is projected to grow but Glovo could not overcome industry hurdles.

Glovo, a popular food ordering and delivery app, revealed plans to cease operations in Ghana on May 10, 2024, following substantial investments over the past two years aimed at broadening its services. The company informed its restaurant partners of this decision via email, citing challenges with profitability in the Ghanaian market as the reason. Going forward, Glovo will concentrate on strengthening its position in other African countries, including Morocco, Uganda, Kenya, Côte d’Ivoire, and Nigeria.

“We are reaching you to communicate that Glovo has decided to close our Ghana operations by May 10th at 10:00 pm. The decision to end our operations in the country is based on a reassessment of our investment priorities as we focus our resources on the other 23 countries where Glovo operates.”

“As your service provider company will also inform you, the app and the slots will remain active until May 10th, 10:00 pm… after that, the app will close, and won’t be able to book any slots.”

In 2021 co-founder of Glovo, Sacha Michaud said the company was investing 1.7 million euros in the company.

“The Ghanaian market is a promising market for Glovo and we will continue to invest to reach all the regions of the country and bring convenience to people,” he said at the time.

Glovo, a technology delivery company established in 2015, with headquarters in Barcelona, Spain, entered the Ghanaian market in March 2021.

According to Mr. Michaud, Glovo entered the Ghanaian market to provide customers with the convenience of ordering products online and having them delivered to their doorstep. During the launch, he noted that Ghana’s growing population and increasing internet access created a favorable business environment. Ghana was one of seven African countries where Glovo operated, alongside markets like Kenya, Nigeria, and South Africa. Additionally, Mr. Michaud revealed that Glovo Ghana had partnered with around 400 businesses in Accra, including pharmacies, grocery stores, electronics retailers, and restaurants, to offer a diverse range of products to customers.

The food delivery ecosystem is currently facing numerous challenges, including high taxes, low wages, and high inflation. Despite these challenges, Ghana’s online food delivery market is expected to experience significant growth, with projected revenues of $224.60 million in 2024. The market is expected to grow at an annual rate of 19.37% between 2024 and 2029. By 2029, the market is expected to reach a volume of $544.30 million. The growth of the online food delivery market in Ghana is driven by increasing consumer demand for convenience and efficiency in food delivery services.

Jumia, like some other African countries, discontinued its services in Ghana in December 2023. Meanwhile, Bolt Food has closed its operations in Nigeria and South Africa but remains active in Ghana.