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December 23, 2021updated 24 Jan 2022 10:19am

Delivery Hero to downsize Foodpanda’s German reach; offload Japan arm

The company has identified new potential markets with better ROI and new verticals.

German online food delivery service Delivery Hero is set to shrink Foodpanda operations in Germany as well as plans to sell Foodpanda Japan in Q1 2022.

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In Germany, Foodpanda will operate in only select cities including Cologne, Düsseldorf, Frankfurt, Hamburg, Munich and Stuttgart.

However, it will continue to operate its Berlin-based hub to trial new product features and technologies.

Delivery Hero co-founder and CEO Niklas Östberg said: “Scaling down our operations in Germany and planning to divest our Japanese business have not been easy decisions.

“Despite having built up two fantastic foodpanda teams showing great progress, it has become increasingly difficult to create true value for our ecosystem in these countries. I have nothing but gratitude and admiration for the accomplishments both teams have achieved in the last months.”

Delivery Hero launched the Foodpanda service in Berlin this summer, and later expanded its operations to other German cities.

However, the online food delivery service firm faced challenges in the market such as rising number of competitors, and shortage of riders.

The company has now identified new potential markets with better returns on investment (ROI) and new verticals, primarily in quick commerce.

Affected Foodpanda staff will be transferred to positions within the Delivery Hero Group, its industry partner network or get a severance package.

In Japan, the company’s decision to divest Foodpanda is said to be part of its focus on other growth priorities.

In August this year, Delivery Hero signed an agreement with a consortium to sell its Korean unit for an enterprise value of $687m.

Free Report
img

Meet emerging digital demand in the foodservice industry

Global digital pressures are making waves across sectors. The foodservice industry is seeing particular impact as consumers change the way they operate. It is therefore essential to know how to navigate the challenges that digital is presenting to the industry and its consumers. GlobalData’s free report explores the market outlook for the global foodservice industry, with insights into how foodservice operators, brands, and their suppliers can meet changing demands. Key features in this report include:
  • An overview of dine-in, takeaway, and delivery forecasts up to 2026
  • Areas foodservice industry players should be focusing on for digital investment
  • Consumer insight into attitudes towards digital convenience
  • Challenges facing foodservice, in terms of investment and logical considerations
  • Key examples of top industry players
Adapt and stay on top. Download our free report now.
by GlobalData
Enter your details here to receive your free Report.

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