Glovo to Close Operations in Ghana After €3.5 Million Investment
In a surprising move, food delivery platform Glovo has announced that it will cease operations in Ghana on May 10, 2024. This decision comes just two years after the company invested €3.5 million ($3.7 million) to expand its services in the country.
According to an email sent to its restaurant partners, Glovo cited profitability issues as the primary reason for its exit from the Ghanaian market. The company acknowledged the potential of the Ghana market. But stated that achieving profitability would require substantial investment over an extended period of time.
As of 10 p.m. on May 10, 2024, customers’ apps will no longer be available for ordering. And also restaurant partners will receive outstanding payments based on the terms and conditions.
Glovo will now shift its focus to other African markets, including Morocco, Uganda, Kenya, Côte d’Ivoire, and also Nigeria.
Despite this setback, Glovo’s co-founder, Sacha Michaud, had previously expressed optimism about the Ghanaian market. He highlighted the country’s growing population and increased Internet penetration as advantageous factors for business.
The online food delivery market in Ghana is expected to generate $224.60 million in revenue in 2024. Also with a projected market volume of $544.30 million by 2029.
Glovo’s decision to exit Ghana follows similar moves by other food delivery platforms. Jumia Food discontinued its services in Ghana in December 2023. while Bolt Food remains active in the country despite exiting Nigeria and South Africa.
The email announcement sent by Glovo to its restaurant partners regarding the closure of operations in Ghana
Dear Restaurant Partners,
We regret to inform you that after careful consideration, Glovo has made the difficult decision to cease operations in Ghana. Our last day of service will be May 10, 2024.
Reasons for Closure:
- Profitability Challenges: Despite our initial investment of €3.5 million to expand in Ghana. Achieving profitability has proven to be a significant challenge. We appreciate the support from our restaurant partners, but sustaining operations in the current market conditions is no longer feasible.
- Market Dynamics: While Ghana holds immense potential. The competitive landscape and cost structure have made it increasingly difficult for us to operate profitably.
Next Steps:
- App Removal: As of 10 p.m. on May 10, 2024, the Glovo app will no longer be available for ordering in Ghana.
- Outstanding Payments: We assure you that all outstanding payments will be settled based on the terms and conditions of our partnership.
Future Focus:
Glovo remains committed to serving customers in other African markets. Our focus will shift to countries where we can create sustainable value for both our partners and users.
We appreciate your partnership and hope for continued success in your business endeavors.
Thank you for being part of the Glovo journey.
Sincerely,
The Glovo Team
