End of road for Deliveroo: last order's on April 7

Jamie Liu

British online food-delivery platform Deliveroo announced yesterday that it will wind down its operations in Hong Kong after nine years. The platform will remain live until April 7.

Following the news, the remaining two other major delivery platforms - Foodpanda and Meituan's Keeta - scrambled to attract new customers.

Deliveroo has placed a notice to users on its platform that they can switch to Foodpanda. At the same time, Foodpanda introduced several discounted offers, including for Deliveroo's members.

These users will be able to enjoy free membership of the "PandaPro" plan for six months, valued at HK$534.

Keeta announced it will give away HK$50 coupons to new members. For users who invite friends to join, they and the new members will receive coupons ranging from HK$100 to HK$150.

Deliveroo said it decided to exit its Hong Kong operations through the sale of certain assets to Foodpanda and the closure of other assets.

It has nominated liquidators to manage the closure and the remainder of its assets "in the most efficient way possible."

London-based Deliveroo launched its business in Hong Kong in 2015. It has partnered with over 10,000 restaurants and riders, according to Nick Price, Deliveroo's Hong Kong general manager, in January 2024.

An earlier market survey found that Deliveroo's overall market share fell to about 25 percent in the first quarter of last year from about 30 percent in the previous year, while Keeta accounted for more than 30 percent. Foodpanda had more than 40 percent.

Delivery Hero, parent companyof Foodpanda, said it has acquired selected assets from Deliveroo.

This will see Deliveroo customers and riders redirected to the Foodpanda platform, as well as certain restaurants and grocery shops, Deliveroo said.

Existing Deliveroo customers are also entitled to a free six-month membership at Foodpanda.

"This transaction will give customers on the Foodpanda platform access to a wider range of restaurant and grocery businesses, including some only available on the Deliveroo app. Vendors joining the platform will be able to tap into a new customer base to boost their success," it said.

Delivery Hero described its decision to further invest in Hong Kong as "part of its commitment to maintain a sustainable delivery ecosystem that provides the best value for Foodpanda customers, couriers and business partners."

Deliveroo quit another Asian market, Taiwan, in April 2020 during the pandemic.

Economist Simon Lee Siu-po said he is "not surprised" by Deliveroo's withdrawal from Hong Kong, as the city's market for food-delivery services is small and highly competitive, making it difficult to accommodate three competitors.

He pointed out that the food-delivery market share is relatively small because there are alternatives to delivery, such as customers going out to buy food themselves or restaurants providing their own delivery services.

"Combined with the shrinking local dining market compared to prepandemic times and cross-border consumer spending, as well as discount-driven customers, the food-delivery business has become increasingly challenging," Lee added.

Speaking to The Standard, Mak Tak-ching, organizer of Riders' Rights Concern Group, said he did not immediately receive any requests for assistance related to Deliveroo, as the platform is still weeks away from halting its operations.

But he voiced concerns about potential labor rights issues, noting that many delivery couriers are classified as self-employed under labor laws.

jamie.liu@singtaonewscorp.com