It’s a tough economic situation for food delivery companies, and Getir has called it a day in Europe. It confirmed its leaving the UK, Germany, the Netherlands, and FreshDirect, the US subsidiary of Getir, will however continue its operations.
By mid-May, the fast delivery company will have ceased operations in Europe, focusing solely on its Turkish market.
In 2015, Getir started with quick deliveries in Turkey and expanded to the UK in early 2021. Over the past decade, the quick-commerce business grew into one of many delivery enterprises promising under-15-minute service.
In 2022, Getir bought Gorillas, its German rival, and that same year, it also bought the UK’s Weezy, reports The Guardian. Gopuff is now seen as one of the last remaining grocery specialists in the quick-commerce field. Gopuff was launched in the UK in 2021 and operated in London along with Zapp.
Layoffs and a tough economy
Nearly 2,000 workers have to find new jobs, with German warehouse workers reportedly being let go.
While the impact on the labor market is intense, the rising food costs on the last-mile delivery sector have been weighing down heavily on delivery companies.
The challenges with gig economy workers and high food prices have narrowed profit margins.
Getir has responded to Locate2u’s right of reply, saying it generates only “7% of its revenues from the markets it is exiting.”
Tight on cash
Earlier this month, Bloomberg reported that investors are “pushing” for significant changes within Getir, including “asset sales and market exits.” There were reports about possible restructuring.
According to Bloomberg, investors have poured over $2 billion into Getir to date. In September, it raised $500 million at a valuation of $ 2.5 billion.
During the pandemic, Getir experienced a surge in business, just like many other quick commerce companies. However, the demand for services seems to wane, calling for desperate measures.
In it’s latest response to Locate2u, Getir confirmed that it has raised a “new investment round, led by Mubadala and G Squared.” It will be utilizing these funds to “bolster its competitive position in its core food and grocery delivery businesses in Turkey.”
Should quick commerce still exist?
With quick commerce companies’ quick rise and fall, vowing to deliver goods at a record time, is it still relevant?
The Central Consumer Protection Authority (CPA) in India has asked quick commerce companies to prove that they can deliver orders in 10 minutes or less as claimed. If they can’t Moneycontrol reports that they must change their advertisements.
The industry reacts
Seb Robert, CEO and founder of same-day delivery business Gophr, told LinkedIn that he believed Getir would be able to pull through the economic turbulence.
“I genuinely thought Getir had a good chance of cracking it because they’d been at it for so long in Turkey that I felt if anyone would have a significant advantage over competitors, it was them. Even with the elevated costs associated with operating in major European cities.”
While many speculate what might have led to the company’s demise, some argue that the odds weren’t stacked against them. “Getir had an excellent chance of succeeding in the UK market, only if it had better management who understood the European market,” writes Kapil Kumar.
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Mia is a multi-award-winning journalist. She has more than 14 years of experience in mainstream media. She's covered many historic moments that happened in Africa and internationally. She has a strong focus on human interest stories, to bring her readers and viewers closer to the topics at hand.
