Glovo is set to shut down its services in Ghana after two years of investing $3.7 million. Food delivery platform, Glovo will be shutting down operations on May 10, 2024, in Ghana, two years after it invested $3.7 million to help expand its operations.
Glovo Is Set To Shut Down in Ghana
The company as you should know made the said announcement via email to its restaurant partners. And according to the firm, it made the decision to halt operations due to profitability problems in the Ghanaian market.
With the said development, Glovo will concentrate on other African markets such as Uganda, Morocco, Kenya, Cite d’Ivoire, and Nigeria.
“While we recognize 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,” the delivery platform says through email.
Closure Announcement
Glovo has announced that starting from 10 p.m. on May 10, 2024, customers won’t be able to use their apps to place orders anymore. Restaurant partners will receive any outstanding payments according to the terms and conditions.
Previous Commitment
In 2021, Glovo’s Co-founder Sacha Michaud expressed optimism about the Ghanaian market. He highlighted the company’s commitment to investing in reaching all regions of the country to provide convenience to its people. Michaud pointed out Ghana’s growing population and increased Internet penetration as favorable factors for business.
Partnerships and Growth
Glovo Ghana had partnerships with around 400 partners in Accra, spanning pharmacies, groceries, electronics, and restaurants. The service witnessed significant order growth, ranging from 30-45% month to month.
Challenges in the Food Delivery Ecosystem
Reports indicate that the food delivery sector in Ghana faces challenges such as high taxes, low wages, and high inflation. Despite these hurdles, the online food delivery market in Ghana is projected to generate substantial revenue, with an expected annual growth rate of 19.37% between 2024-2029.
Industry Trends
Jumia ceased its operations in Ghana in December 2023, following similar moves in other African countries. Meanwhile, Bolt Food, despite closing operations in Nigeria and South Africa, remains active in Ghana.
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