Foodora Canada announced plans to close its business in May.
The food delivery service plans to cease operations effective at the end of the day on May 11th. In a press release, Foodora says it has not been able to reach a suitable level of profitability in Canada. In part, this is due to Canada’s “strong local players” and “highly saturated market” for online food delivery.
Further, Foodora says the strong competition has intensified of late, likely due in part to increased demand as more people rely on food delivery services during the COVID-19 pandemic.
“We’re faced with strong competition in the Canadian market, and operate a business that requires a high volume of transactions to turn a profit. We’ve been unable to get to a position which would allow us to continue to operate without having to continually absorb losses,” said David Albert, managing director of Foodora Canada.
Foodora, which has operated in Canada for the past five years, offered service in ten cities across the country. Additionally, Foodora has more than 3,000 partner restaurants across the country.
Employees will continue to be paid as stipulated in their contractual agreements, while Foodora’s rider community has also been given notice of termination.
Delivery Hero owns Foodora and maintains number0one competitive market positions in 36 of 44 countries across Europe, Latin America, Asia-PAcific, the Middle East and North Africa. Additionally, Delivery Hero operates its own delivery service primarily in over 530 cities around the globe. Delivery Hero is headquartered in Berlin, Germany.