The local delivery industry has been shaken up with the news Deliveroo will no longer operate in Australia after six years in business.
The company announced it had entered the voluntary administration process, saying the move “had not been an easy decision to make”.
It’s estimated more than 15,000 riders are now out of a job, with thousands of venues now relying on a smaller pool of delivery providers to reach customers.
Deliveroo has stopped accepting orders, and says the company could no longer fulfil its goal of creating “the very best food delivery service in the world”.
“Where we cannot fulfil this mission to the levels we expect and to provide you the experience you deserve, we won’t operate,” reads a statement from Ed McManus, General Manager, Australia.
“In Australia, we have concluded that achieving a sustainable position of leadership in the market is not possible without a disproportionate level of investment which would have highly uncertain returns.”
The company confirmed fees for orders completed through the end of 14 November have been paid out, with outstanding fees – including tips – to be reviewed during the administration process by voluntary administrators KordaMentha.
The Australian Financial Review reports the company will pay riders two weeks’ pay based on weekly earnings from the past 12 months, with an additional two weeks’ pay provided “if the deal proposed under the Deed of Company Arrangement is supported”.
Deliveroo said riders would receive two weeks’ pay – based on average weekly earnings over the past 12 months – with a further two weeks provided in the event the deal proposed under the Deed of Company Arrangement is supported.
Deliveroo’s departure means there is one less player in the delivery landscape, with Uber Eats, DoorDash and Menulog as well as smaller operators such as Easi to cater to the market.
A creditors meeting will take place on 28 November.