Foodora Canada has announced it will cease its operations in Canada by the end of day on May 11, 2020.
The food delivery service says it has “filed a notice of intention to make a proposal and plans to cease operations effective the end of day on May 11th,” citing after five years of operating in Canada, it has “not been able to reach a level of profitability” to sustain its operations.
Foodora said competition from “strong local players” and a “highly saturated” market for online food delivery are reasons why it is shutting down. The company says it is working on putting together a plan to support employees and other creditors affected by the upcoming shut down.
“I’m very proud of what foodora has accomplished over the last few years. I’ve been able to witness food delivery grow from its infancy into what it is today, and helping to build a brand I’m proud of. However, there’s been some challenges along the way. We’re faced with strong competition in the Canadian market, and operate a business that requires a high volume of transactions to turn a profit. We’ve been unable to get to a position which would allow us to continue to operate without having to continually absorb losses,” said David Albert, Managing Director of foodora Canada, in an emailed statement.
The company expanded to reach 10 cities in Canada and the shut down will affect employees along with its rider community, which also will be let go once operations close. Last fall, couriers for Foodora in Toronto were the first unioned group of app-based workers, as workers joined the Canadian Union of Postal Workers.
Foodora is a subsidiary of Delivery Hero SE headquartered in Berlin, Germany.