Deliveroo confirms Dutch exit

International food delivery app Deliveroo confirmed Wednesday it was quitting the Netherlands next month, saying it would take “disproportionate levels of investment” to remain competitive in the country.

The British-based start-up said it will end all Dutch operations by the end of November.

“Following consultation with employees and riders, Deliveroo has determined that achieving and sustaining a top-tier market position in the Netherlands would require a disproportionate level of investment,” Deliveroo said.

Long-term potential returns would remain “highly-uncertain,” the London-based start-up said in a statement.

Deliveroo in August said it was planning an exit from the country which it said represented a meagre one percent of its turnover in the first half of this year.

Compensation packages for riders have been agreed with the umbrella Dutch trade union federation FNV, it said.

Deliveroo said the move would not affect a previously released guidance for the group’s growth and income margins.

“The decision to end operations in the Netherlands reflects the company’s disciplined focus on continuing to maximise returns on investment of resources while meeting existing profitability targets against a challenging economic backdrop,” Deliveroo said.

Home delivery companies booked great successes during the Covid-19 pandemic, but the phenomenon has since subsided.

Deliveroo in August announced a big jump in losses, saying investment costs were eating into rising revenues.

The planned exit from the Netherlands followed Deliveroo’s departure from Spain last year although it said in August it had gained market share in the UK and Italy.