Glovo, a prominent delivery platform, is set to conclude its operations in Ghana tonight at 10:00 pm. The decision, unexpected by many stakeholders, was announced last month, with the company attributing high operational costs and revenue shortfalls as primary reasons for its departure.
Effective from 10 p.m. on May 10, 2024, the Glovo app will no longer accept orders in Ghana. Additionally, the company assures that any outstanding payments owed to restaurant partners will be settled according to agreed terms and conditions.
This move follows a period of consolidation for Glovo Ghana, which saw the merger of its Osu, Spintex, and Kumasi branches with its East Legon headquarters earlier this year due to financial constraints. A recent visit to the East Legon office revealed an empty space, stripped of equipment, furniture, and signage.
The repercussions of Glovo’s exit extend beyond mere logistics. Nearly 30 direct staff members, including managers and various department workers, will face job losses. Additionally, the departure will significantly impact the hundreds of delivery riders who formed the backbone of Glovo’s services.
In an email addressed to restaurant partners, Glovo cited challenges in achieving profitability in the Ghanaian market as the driving force behind its exit. The company now aims to refocus its efforts on strengthening its presence in other African markets such as Morocco, Uganda, Kenya, Côte d’Ivoire, and Nigeria.
“While we acknowledge Ghana’s potential,” Glovo stated in the email, “establishing a robust position and attaining profitability would demand substantial investment over an extended period. Thus, we’ve opted to allocate resources to our other 23 markets to better cater to existing clientele.”
This development comes as a surprise, especially considering the optimism expressed by Glovo Co-founder Sacha Michaud in 2021, who had outlined plans to expand services across Ghana and leverage the country’s growing population and internet penetration. Despite collaborating with approximately 400 partners in Accra, Glovo Ghana encountered obstacles despite favorable market conditions.
Industry forecasts estimate Ghana’s online food delivery sector to reach US$224.6 million in 2024, with an expected annual growth rate of 19.37%. This projection indicates a market volume reaching US$544.30 million by 2029.
Glovo’s withdrawal aligns with recent trends within the industry, with Jumia discontinuing operations in Ghana in December 2023. Similarly, while Bolt Food has exited Nigeria and South Africa, it remains operational in Ghana.
The future remains uncertain for Glovo’s remaining staff and delivery riders. Nevertheless, one certainty emerges: Glovo’s departure leaves a void in Ghana’s burgeoning online delivery market, potentially opening avenues for other companies to expand their footprint.
