Delivery service provider Glovo has made a startling announcement to cease its operations in Ghana.
The company’s official customer app will no longer accept orders starting from May 10, as confirmed by a notice to a client that was later publicized.
The decision comes as Glovo acknowledges the need for a prolonged effort to secure a robust market position and profitability. Consequently, the company has decided to reallocate its resources to the other 23 countries where it currently operates.
Glovo has assured its clients likely to be affected by the decision of outstanding payments per the company’s terms and conditions in due time.
In a strategic move that has taken many by surprise, Glovo has opted to focus on markets where it sees more immediate potential for growth and profit.
This decision follows an initial investment of €25 million ($30 million) to introduce its food delivery service to six African countries, including Ghana, as reported by Business Insider Africa in October 2021.
Despite the ambitious launch of its Ghanaian operations in March 2021 and a commitment to invest 3.5 million euros, as stated by Co-Founder Sacha Michaud in October 2021, Glovo has found the path to profitability in Ghana to be more challenging than anticipated.
Social media reactions to Glovo’s departure have been mixed, with some users attributing the closure to high taxation and rising petroleum prices, while others speculate on market share challenges or political motives.
This development is a significant shift in the African delivery service landscape, leaving stakeholders and market watchers to ponder the implications for the future of the industry in the region.