Foodora Inc., a Germany- based online food delivery company, has reportedly announced plans to shut its business after five years of operation in Canada. The company said that Canada is a highly competitive market for online food delivery landscape and has lately witnessed even more intensified rivalry among food delivery firms. The company has not been able to achieve a level of profitability in the region that is enough for it to continue operations.
In a press release, David Albert, Managing Director at Foodora Canada stated that the company has been facing strong competition in Canada’s market. It operates a business that needs a high volume of transactions to make a profit and the company has failed to achieve a position that would allow it to continue to work without having to absorb losses, Albert continued.
The Foodora service has grown to 10 Canadian cities across the nation and has ranked up around 3000 restaurants in its platform. It faced tough market competition from online food delivery giants such as DoorDash, SkipTheDishes, and Uber Eats. The company will continue to run until May 11, 2020, and its workers, as well as the rider community, have received their notices for their termination.
As per sources, this announcement was a blow for couriers who have been dealing with increasing orders amid coronavirus outbreak and grappling with no-contact delivery and new policies. The news was extra challenging for selective couriers as they had been a part of Foodsters United which has been fighting for protections and rights for Foodora couriers. They alleged that Foodora was using the independent contractor model in order to avoid giving workers safety and health support.
For the record, Foodora is an online food delivery company offering foods from a curated list of local restaurants. The company had been working across 10 cities in Canada with over 3,000 partner restaurants.