British food delivery firm Deliveroo announced on Monday that it will end operations in Hong Kong next month after reaching an agreement with local rival foodpanda. The decision comes amid intensifying competition in the city’s food delivery market, particularly following the 2023 launch of KeeTa, an app backed by Chinese e-commerce giant Meituan, which quickly overtook Deliveroo in order volume.
In a statement, Deliveroo said it had appointed liquidators to oversee the closure of its Hong Kong business, ensuring an efficient winding down of operations. The platform will remain active until April 7, after which Deliveroo will sell some assets to foodpanda and shut down others.
“We have been proud to serve so many people such amazing food over the past nine years,” said Deliveroo’s chief operating officer, Eric French.
Berlin-based Delivery Hero, the parent company of foodpanda, confirmed the agreement, stating that Deliveroo’s customers and couriers would be redirected to foodpanda and that certain vendors would be integrated into its platform.
A Tough Market for Deliveroo
Deliveroo entered the Hong Kong market in 2015, a year after foodpanda’s arrival, as part of its global expansion strategy. However, the company has struggled to compete in recent years.
In its 2024 interim results, Deliveroo described Hong Kong as a laggard among its key markets, citing challenging competition and unfavorable market conditions. The firm stated that Hong Kong accounted for five percent of its total gross transaction value in 2024 but contributed to a five-percentage-point decline in international growth.
In contrast, foodpanda’s parent company Delivery Hero reported strong customer growth in Hong Kong in December, signaling a more favorable outlook for its business in the city.
This is not the first time an international food delivery company has struggled in Hong Kong’s highly competitive market. In 2021, Uber Eats ended its five-year run in the city after failing to secure a significant market share.
Labour Disputes and Market Pressures
Hong Kong’s food delivery sector is projected to generate $4.4 billion in revenue in 2024, with an expected rise to $5.8 billion by 2029, according to Statista. However, the market has also been plagued by labour disputes, with major delivery platforms facing accusations of poor worker protections.
In March 2024, striking workers accused Deliveroo, foodpanda, and KeeTa of failing to provide adequate labour protections. The Riders’ Rights Concern Group highlighted that delivery workers have seen wages drop sharply, particularly following KeeTa’s rapid expansion.
“What the delivery workers have experienced is dropping wages faster than ever,” the group said in a statement last December.
Deliveroo’s exit from Hong Kong marks another shift in the city’s food delivery landscape, as KeeTa and foodpanda continue to dominate a market that remains highly competitive and increasingly difficult for foreign players to navigate.
