Online food delivery platform Deliveroo has ceased operations in Australia and appointed voluntary administrators following a decision to exit the market.
Deliveroo launched in Australia in 2015 with headquarters in Melbourne, Victoria. The business has over 12,000 partner restaurants, 15,000 riders / drivers and employs approximately 120 staff, with the business recently having expanded into grocery and liquor delivery.
In a message emailed to customers yesterday, Deliveroo said it is doing business in challenging economic conditions, which requires difficult decisions.
“We always aim to deliver the best possible service for our consumers wherever we operate, and if we cannot do that we will be prepared to review our position,” the message read.
“In Australia, we have concluded that achieving a sustainable position of leadership in the market is not possible without a disproportionate level of investment which would have highly uncertain returns.”
Advisory and investment firm KordaMentha has been appointed as the voluntary administrator. Michael Korda from the firm says Deliveroo was unable to achieve sufficient market share in Australia to develop a sustainable business.
“Administrators had no alternative but to cease operations immediately in the absence of financial support,” he said. “Our priority is to execute an orderly wind-down of the Australian operations to achieve the best outcome for all stakeholders.”
Deliveroo had collaborated with a number of FMCG brands and retailers in recent times, including Magnum and Ben & Jerry’s for National Ice Cream Day, BP and EzyMart.