Cab-hailing startup Ola's parent ANI Technologies Pvt. Ltd has reportedly suspended Foodpanda's delivery business and terminated the contracts of several food delivery executives, a media report said.
ANI Technologies Pvt. Ltd acquired Foodpanda some 18 months ago.
In the last two weeks, Ola has dissolved the ground team completely, Mint said, citing people familiar with the matter. The company, however, has retained the core operations team consisting of senior employees, the report added.
Foodpanda will be focusing only on running the cloud kitchen brands instead of a food delivery business, a source familiar with the development told the newspaper.
According to The Economic Times, Ola is concentrating on building its private label brands, which include The Great Khichdi Experiment, Lovemade and FLRT.
In December 2017, Ola acquired Foodpanda India in an all-share deal and said it would invest $200 million (over Rs 1,280 crore) in the business. Ola acquired Foodpanda India from its German parent, Delivery Hero. Delivery Hero had acquired Foodpanda from Rocket Internet in December 2016 to extend its food-ordering business into Asia, the Middle East and parts of Eastern Europe.
Foodpanda competes with UberEATS and Zomato and Swiggy. Uber, the US-based ride-hailing firm is aggressively expanding meal order and delivery platform UberEATS in India.
Ola had in 2015 attempted its own food delivery service, called Ola Cafe in Delhi, Mumbai, Bengaluru and Hyderabad but shut it down a year later after failing to meet targets.
The competition has been intense in the segment with the likes of Zomato and Swiggy fighting aggressively to capture the market.
The online food ordering market in India is likely to grow at over 16 percent annually to touch $17.02 billion by 2023, according to a study by business consultancy firm Market Research Future. The growth in online food ordering market has been attributed to the rising number of women among the working population in most of the metro cities.
Bengaluru gets the highest number of online orders as compared to other cities with 20 percent of the market share acquired by the southern city, the report said.
It is followed by Mumbai, Pune, Delhi and Hyderabad with a share of 18 percent, 17 percent, 15 percent and 12 percent, respectively, while other cities accounted for 18 percent of the market share.
"The rising number of logistics providers has also enabled food delivery companies to optimise their fleet, thereby reducing delivery time. Online food delivery platforms are focused towards acquisitions and are collaborating with logistics companies to manage delivery operations in the dedicated region," the study had said.
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Updated Date: May 22, 2019 14:38:51 IST