Turkish rapid grocery delivery firm Getir set to pull the plug on UK, German and Dutch operations
Getir is gearing up to announce next week that it is withdrawing from the UK, Germany and the Netherlands.
According to a Sky News report, thousands of jobs will be put at risk, including approximately 1,500 in the UK.
The move could involve a sale of its assets or an insolvency procedure, insiders said.
It would leave Getir with operations in the US and Turkey only, although the ultimate aim is to operate solely in Turkey, where it was founded.
AlixPartners, the restructuring firm, is understood to be advising on the situation at Getir, which is backed by the likes of Mubadala, the Abu Dhabi sovereign wealth fund, Sequoia Capital and Tiger Global.
It was valued at $11.8 billion when it raised more than $750 million in a funding round in 2022.
Getir did not respond to our request for comment.
Increasing operational efficiency
Late last year, Getir announced a global restructuring initiative, with plans to cut 2,500 jobs across five countries, or 10.9% of its total workforce.
It said it would continue to operate in Turkey, the UK, Germany, the Netherlands and the United States.
The company had previously reported its exit from Italy, Spain, and Portugal.
It said in a press statement: “We will restructure the global organisation to significantly increase operational efficiency.”
“The Getir network consists of roughly 23,000 people across five countries. This number includes couriers, pickers, and office employees. Regrettably, we intend to reduce our team and, with a heavy heart, part ways with approximately 2,500 talented employees across our markets.”
It added: “Decisions like these are never taken lightly. However, Getir is determined to do right by all employees affected by the process in line with its values and in full compliance with local laws. We are very grateful to all colleagues for their hard work, dedication, and significant contributions to the business.”
It concluded: “The company remains fully committed to the future of the industry it pioneered eight years ago and will continue to lead it in the future.”
Deliveroo
Deliveroo recently said that it recorded positive earnings before interest, taxes, depreciation, and amortisation (EBITDA) last year, citing strong demand for takeaways and lower costs.
The company reported adjusted EBITDA of £85 million, up from a loss of £45 million in 2022. Its overall adjusted EBITDA margin increased to 1.2% from -0.7%
Sales increased three per cent, and the gross transaction value per order rose 6% to £24.3. Overall, the company’s loss for the period was £32 million, compared to £262 million last year.
Will She, Founder and CEO at Deliveroo, said: “This is great progress, but it is still early days for us in capturing the full range of opportunities we have ahead.”
“We have always been focused on developing the best hyperlocal CVP for consumers, which drives profitable consumer engagement.”
“We truly believe the key to unlocking growth in the industry is through building consumer trust, and we can do this through price integrity and building a flawless delivery experience.”
“I am very confident we will generate strong, sustainable free cash flow and accelerate GTV growth.”
“Since I started this company 11 years ago, I have never been more confident in our strategy and the team we have to deliver it. Our strategy for the coming years combines levers to drive and capture growth, with levers to increase profit.”
Whilst there are some positive takeaways from the financial results, they do also rather beg the question: will rapid food/grocery delivery brands ever become truly profitable?
If a big hitter like Deliveroo is struggling with this, and at a time when fellow heavyweight Getir is facing a make or break moment, what hope for everyone else?
Check out RTIH’s take on rapid food and grocery delivery space here.
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