Glovo leaves Ghana | What this means for the Food Delivery Industry in Ghana? (PodBites Ep. 44)

[00:00:00] Hey everyone, welcome to another edition of Podbites, this is Adrian from The Sound of Accra

[00:00:03] Podcast. So some of you may have heard Glovo, the food delivery app, the multinational food

[00:00:09] delivery app have decided to call it quits and leave the Guardian market. So they are

[00:00:14] going to reallocate resources to other markets that are performing much better than Ghana.

[00:00:19] Now this is a fair decision and I'm sure it was a difficult one as Ghana generally is

[00:00:23] a good place to do business in, especially when you are a multinational trying to

[00:00:28] enter the African market. Of course we all know that Ghana is regarded as the gateway to

[00:00:32] Africa and especially through the hospitality, generally when multinational business steps

[00:00:37] in they generally perform well. I mean just look at KFC which entered the Guardian market

[00:00:42] I think just over 10 years ago who have been successful and they have established themselves

[00:00:46] in Accra and beyond Accra, they've got many branches across the country. Look at Burger

[00:00:51] King that have done well, that have followed KFC not too long after they came. So these

[00:00:57] have all entered the Guardian market for many years and they've established themselves amongst

[00:01:01] Ghanaians in the city of Accra and beyond. Now reasons why Glovo have followed other

[00:01:07] multinational out of the door as well as coming into the door. So some examples of some

[00:01:13] multinational have actually left the door rather than coming into the door is the

[00:01:18] South African supermarket chain game which some of you may be aware of. For example

[00:01:25] you may go into Accra more, you may notice there's a huge void in the Accra more and you'll notice

[00:01:30] that game is no longer there which used to have a big presence in the Accra more and of course

[00:01:36] across the city of Accra. And you guys may have heard if you guys have been listening

[00:01:41] to the South Africa podcast you may have heard about the pod bite that I did on

[00:01:45] the telecommunications brand Vodafone leaving the Guardian market and they had their own

[00:01:50] reasons for leaving the Guardian market but it's not all gloom and doom. So see a previous pod

[00:01:56] bite episode where I go into more details regarding Vodafone's departure from Ghana

[00:02:01] who since have seen the successful takeover of the Guardian brand being taken over from

[00:02:07] the South African brand Tethysel. I believe it is South African but links below for that

[00:02:12] episode will be in the description player where you're listening to this on the podcast players

[00:02:17] or on YouTube. Now it does seem fitting to record another episode exploring other top foreign

[00:02:24] companies that have left Ghana almost as quickly as they've entered Ghana so hopefully you guys

[00:02:30] can look out for the episodes sometime soon. I'm not sure when that will come out as of course

[00:02:34] right now as I'm recording this episode in May 2024 season six is also running so

[00:02:40] let's see what me and the team can do. So look out for future episodes regarding

[00:02:45] multinational companies that have entered the market and have left the Ghana market.

[00:02:50] I think this will make for great content. Alright so let's take a look at what's happened with

[00:02:55] Glova. Now firstly the economic climate of Accra has been tricky over the past few years and

[00:03:00] that's clear for everyone to see. I mean the city has been quite volatile on top of that

[00:03:06] the country hasn't had the best number of months and the year or two where there's been even

[00:03:13] more challenges with with electricity you know a lot of outrage with ECG and the things couldn't

[00:03:20] get any worse there's been internet allergies of late that have disrupted anyone who relies on the

[00:03:25] internet in Ghana. Now Glova announced their departure officially on 10th May 2024 and their

[00:03:31] reasons for leaving the Ghana market was down to not being able to turn a profit which is

[00:03:36] understandable because if you can't make money it doesn't make sense and of course the

[00:03:42] challenging business climate that currently faces Ghana. Now Glova of course isn't the only

[00:03:48] delivery service provider as you guys may know if you have been following the show for quite some

[00:03:53] time. You guys may also notice that in season three I spoke to Consume Shop who is a 60 minute

[00:03:59] delivery service at Accra. I interviewed them on season three they are also a delivery

[00:04:04] provider and they're still in business many find that Africa who we spoke to in season five

[00:04:08] they are a food delivery app and they are still in business you also have Balthood who I haven't

[00:04:14] spoken to but they are more than in business Shack Express who I did speak to in season six so

[00:04:21] look out for their episode shout out to Anthony and you've also have other players such as

[00:04:25] Hopto and other independent players in the game. You also have Jumiya Group which used to be

[00:04:32] among this list but they've also departed from the Ghanaian market in December 2022. Now on LinkedIn

[00:04:40] interesting statement was posted by the many finder Africa's founder and CEO Alex D'Arcu who's

[00:04:47] also a friend of mine and he reflected in recent news and I think what he said was very

[00:04:52] interesting so let's take a look at what he said. So he said I've been digesting for a few

[00:04:56] days but being a player in the industry I think it's only right to share some thoughts.

[00:05:02] We actually heard this was coming last week. I think it proves that many find Africa's rationale

[00:05:07] for focusing on the manageable niche that can generate high order value at the right volumes

[00:05:13] is the way to go. Our strategy has always been about quality of a quantity and operating

[00:05:19] within that niche of high value customers. The global exit is not unexpected. I think the

[00:05:24] West Africa market is too scrappy and not mature enough to try and serve everything to everyone in

[00:05:30] the way DoorDash does in the US or delivery in other markets. Much like Jumiya food trying to

[00:05:36] service everything for everyone and especially without a clear focus on riders, brackets pay

[00:05:42] and well-being would always be a difficult task. Markets like South Africa, Kenya etc have a more

[00:05:50] mature service industry and an understanding of what level things need to operate at for these

[00:05:55] kind of services to work. And if you're going to go that widespread then that's a key thing needed

[00:06:01] as part of the foundation. We'll maintain our strong customer service and premium last mile

[00:06:07] experience anticipating increased demand from both customers and merchants. Our priority remains

[00:06:13] unwavering, consistent quality, diverse options and reliable last mile delivery.

[00:06:19] Now that was the statement from Alex Daku once again found in CEO from ManyFindAfrica.

[00:06:24] You guys can go and check out our interview with him on season 5. We'll leave the links

[00:06:28] in the description below. Amazing episode and this statement I think really sums up

[00:06:33] everything that's going on in the food delivery market and really intrigued of what

[00:06:37] ManyFindAfrica have done is that they have stuck to what they can do best which is identify

[00:06:47] some of the top restaurants across the city and then focus on delivering those top restaurants to

[00:06:54] some of their top clients or top customers or certain type of clientele within the city

[00:06:59] and hopefully beyond soon and hopefully across Africa. So they've already niched down,

[00:07:06] they've got a market that they decided to focus on and then they have ran with it. They are not going

[00:07:11] after the whole entire market because they know that it requires a certain level of service in

[00:07:17] order to make that successful and that's essentially what he's saying. So in my opinion,

[00:07:21] with more big international plays leaving the Garnier market, it will give more homegrown

[00:07:27] authentic Garnier plays like ManyFindAfrica, like Shack Express even more room to go

[00:07:32] and capture the market share and even fly the flag for the nation. But I think what's also

[00:07:37] interesting here is that with such news coming out, will this detract other players from entering

[00:07:42] the markets from abroad such as maybe Uber Eats or will this detract other multinationals from

[00:07:48] trying to enter the Garnier market? In the early 2010s, the Garnier market was booming

[00:07:54] and what you can see in terms of trends is that I think more and more international

[00:07:58] plays are leaving the Garnier market, which is quite sad. But I think at the same time,

[00:08:03] there are some international players that are entering the Garnier market. I think Dominos

[00:08:07] Pisa didn't enter the Garnier market too long. But also at the same time, I also think that

[00:08:13] the rates at which international players are entering Ghana in recent years, they are

[00:08:19] leaving Ghana almost within the same rate. And I think that is the trend that I'm seeing.

[00:08:24] So I think for those brands that probably entered the Garnier market a lot earlier,

[00:08:30] they probably had a lot more time for maybe trial and error and to maybe experiment with

[00:08:34] things to try and get the offering spot on so that when things did get bad in the economy

[00:08:39] or in other sectors in the country, they were able to weather the storm. So that's kind of my

[00:08:44] perspective regards to what's happening with the food delivery market in the Ghana.

[00:08:49] So having said that, God bless you guys. Thanks for listening. Let us know your thoughts global

[00:08:54] Garnier citizens. I want to hear from you sending your thoughts and I'll be happy to react to this

[00:08:59] on maybe another episode or maybe we'll go live in YouTube. Drop me an email,

[00:09:03] adrian at thesoundofacra.com. You can also find the Sound of Acra podcast on your favorite

[00:09:08] social media platforms. Just search the Sound of Acra via Instagram, TikTok,

[00:09:13] YouTube, Facebook, Twitter, and you'll be able to find us there guys. So that's

[00:09:17] that's it guys, until the next pod buy on to the next episode. See you later. Take care. God bless.