The loss-making food delivery sector was one of the big beneficiaries of the Covid-19 pandemic, but that effect has waned as consumers, faced with surging prices, have started to cut back.
Analysts still believe food delivery will ultimately become a money spinner, given customers’ love of convenience. But for the moment the sector has to cope with a cost-of-living crunch and companies will be judged on whether they meet margin, not growth, targets.
Read the full article on the Reuters website
NAM Implications:
- Online fulfilment was already losing money before Lockdown.
- As a result:
- Just Eat Takeaway has hiked restaurant commissions across Europe and cut jobs in France,
- Uber Eats has quit Brazil
- Britain’s Deliveroo has exited Spain.
- Deals like Amazon collaboration can help…
- …but future emphasis has to be on margin instead of sales growth.
- Deep breath and deeper pockets necessary…
