German food delivery giant Delivery Hero has scaled down operations in the Asia-Pacific region as part of its plan to “streamline operations to become leaner and more agile”.
“We are sorry to confirm that we had to reduce our team size in the APAC region today, as the need to streamline our operations to become leaner and more agile remains critical. In the coming days and weeks, our focus is on supporting impacted colleagues through this difficult time,” a company statement read.
Most recently, Delivery Hero was reported to be weighing a partial sale of its Asia business. The Berlin-based company plans to sell its businesses under the Foodpanda brand in Singapore, Cambodia, Laos, Malaysia, Myanmar, the Philippines, and Thailand.
According to a Reuters article, Delivery Hero has confirmed that it is in talks for a partial sale of its Asia business at a reported value of $1.07 billion (the number is according to another German publication). The buyer is reported to be Grab Holdings, although this is yet to be confirmed.
Grab is the leader in Southeast Asia’s food delivery market, holding 54% of the region’s gross merchandise value (GMV) in 2022, while Foodpanda captured 19% and Gojek 12%, according to a report from tech research firm Momentum Works.
In another development, Delivery Hero confirmed to DealStreetAsia that it will strategically shift its priorities in the Vietnam business, which will result in a scaling down of operations in the country.
Baemin Vietnam, which is a joint venture between Delivery Hero and South Korea’s food delivery giant Woowa Brothers, has scaled down operations and laid off staff after four years in Vietnam.
“These changes will regrettably lead to some headcount reductions among our local workforce. This strategic decision aligns with our broader DH group strategy, which underscores our commitment to consistently evaluate and enhance our organisational structures,” Delivery Hero’s representative replied in response to DealStreetAsia’s email query.
“Our aim is to evolve into a leaner and more efficient organisation that can achieve our ambitions of becoming a profitable and sustainable business in the long run.”
Baemin Vietnam has confirmed the layoffs. DealStreetAsia has learnt that half of the Vietnamese team has been let go.
The move comes shortly after Jinwoo Song, the CEO of Baemin Vietnam, was asked to leave the company, and Loan Cao, the CFO, was appointed as interim CEO.
While Southeast Asian super app Grab’s food delivery arm, GrabFood, held a 45% share of the Vietnam food delivery market in 2022, Singapore tech giant Sea Group acquired the Vietnamese app Now, rebranded it into ShopeeFood, and inherited a 41% share of the market, according to Statista.com.
Market share of leading food delivery services in Vietnam in 2022
