Glovo to End Operations in Ghana by May 10, 2024: A Shift in African Market Strategy
Glovo, a major food delivery platform, announces its decision to withdraw from the Ghanaian market by May 10, 2024, redirecting focus to other African regions due to profitability challenges.
In a significant move impacting the Ghanaian market, Glovo, a leading food delivery platform, has officially declared its decision to cease operations in Ghana by May 10, 2024. This retreat comes after an extensive investment of €3.5 million ($3.7 million) over the last two years, aimed at expanding its footprint within the nation.
The decision was communicated to its network of restaurant partners via email, citing profitability challenges within the Ghanaian market as the primary impetus. Glovo has outlined plans to reallocate its resources towards strengthening its foothold in other African markets such as Morocco, Uganda, Kenya, Côte d'Ivoire, and Nigeria.
In an official statement circulated via email, Glovo stated, "While we recognise the potential of the Ghana market, building a stronger position in the market and achieving profitability would require substantial investment over an extended period of time. This is why we have decided to redirect our resources towards the other 23 countries where Glovo operates, enabling us better serve the millions of customers who use Glovo app everyday".
Effective 10 p.m. on May 10, 2024, the Glovo app will cease to accept orders in Ghana. The company has assured that all outstanding payments owed to restaurant partners will be settled according to agreed terms and conditions.
Co-founder Sacha Michaud had previously expressed confidence in Glovo's prospects in Ghana, citing ongoing investments to expand services nationwide and enhance user convenience. Despite collaborations with approximately 400 partners in Accra, including pharmacies, groceries, electronics, and restaurants, Glovo Ghana faced challenges amid the promising market conditions highlighted by Michaud. The order growth for Glovo Ghana services exhibited fluctuations between 30-45 percent on a monthly basis.
Industry analysts project Ghana's online food delivery sector to amass revenue of US$224.60 million in 2024, with an annual growth rate of 19.37% (CAGR 2024-2029), potentially reaching a market volume of US$544.30 million by 2029.
Glovo's decision resonates with similar actions undertaken by other industry counterparts; Jumia ceased its operations in Ghana in December 2023, while Bolt Food has withdrawn from Nigeria and South Africa but maintains its presence in Ghana.
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