Glovo, a renowned delivery platform, will suspend operations in Ghana tonight at 10:00 p.m. The business made the unexpected news to stakeholders last month, citing excessive operational expenses and revenue deficiencies as the primary reasons for its exit.
The Glovo app will cease to accept orders in Ghana at 10 p.m. today, May 10, 2024. Furthermore, any outstanding payments owing to restaurant partners will be settled in line with the conditions that were agreed upon.
This decision comes after a time of consolidation for Glovo Ghana. The company merged its Osu, Spintex, and Kumasi branches with its East Legon headquarters earlier this year due to financial constraints.
Read Also: Uganda: TV stations refuse to air Museveni’s census message for free
The consequence of Glovo’s leaving goes beyond logistics. Nearly 30 direct employees, including supervisors and department workers, will lose their employment. The hundreds of delivery riders who make up the backbone of Glovo’s services will also be greatly impacted.
Glovo explained in an email to restaurant partners that its decision was due to challenges attaining profitability in the Ghanaian market. The firm will now focus on strengthening its footprint in additional African markets such as Morocco, Uganda, Kenya, Côte d’Ivoire, and Nigeria.
“We recognize the potential of Ghana,” Glovo stated in the email. “However, building a stronger position and achieving profitability would require substantial investment over a longer period. We’ve chosen to redirect resources to our other 23 markets to better serve existing customers.”
The news comes as a surprise, given Glovo Co-founder Sacha Michaud’s confidence for 2021. Michaud stressed plans to extend services throughout Ghana, capitalizing on the country’s expanding population and internet penetration. Despite working with over 400 partners in Accra, Glovo Ghana encountered problems despite favorable market circumstances.
According to industry estimates, Ghana’s online meal delivery market would produce US$224.6 million in 2024, with a 19.37% annual growth rate. This indicates that market volume will reach $544.30 million by 2029.
Glovo’s exit is consistent with current industry trends. Jumia discontinued service in Ghana in December 2023. Similarly, Bolt Food has quit Nigeria and South Africa but continues operating in Ghana.
