Leading delivery platform Glovo will close its Ghanaian operations by the close of today, May 10. Given the excitement Glovo co-founder Sacha Michaud expressed in 2021, this new development comes as a big surprise to many. The founder lauded Ghana’s growing internet penetration and planned to broaden the company’s services throughout the country.
Last month, the company abruptly informed stakeholders of its decision to withdraw, citing significant operational expenses and income deficiencies as the primary causes.
On May 10, 2024, the Glovo app will stop taking orders in Ghana and unpaid invoices to restaurant partners will be paid according to the parameters that were decided upon. Due to budgetary limitations, the corporation earlier this year combined its East Legon headquarters with its operations in Osu, Spintex, and Kumasi.
The departure of Glovo would definitely contribute to worsening situation of unemployment in the country as all of its staff are put out of work. This would also affect its restaurant partners who rely on the service to reach more customers near and far.
Glovo explained its withdrawal in an email to restaurant partners, citing challenges in turning a profit in the Ghanaian market. The business will now concentrate on strengthening its position in other African markets, including Nigeria, Morocco, Uganda, Kenya, and Côte d'Ivoire.
"We acknowledge Ghana's potential," Glovo wrote in the email. On the other hand, strengthening one's position and turning a profit would necessitate a large investment spread out over a longer time frame. In order to better serve our current clientele, we have decided to reallocate resources to our other 23 markets."
This adds to the growing list of multinational companies that have been leaving the Ghanaian market in recent time. Those that have fully withdrawn include:
- Nivea
- Jumia Foods
- Lipton Tea (Unilever)
- Dark and Lovely
- BET 365
- Game
- BIC
The general, unstable and harsh economic situation in the country contributes to this disturbing trend. Something ought to be done to restructure the fundamental in order to reverse or slow the situation.
