After a report in Mint claimed that Ola-owned Foodpanda was suspending operations and was laying off employees and delivery executives, Ola has denied the reports. The company said that as part of its ongoing business repurposing initiatives, it is focused on building a portfolio of own food brands and curated food offerings.
According to industry sources, Ola is currently refocusing business strategies for Foodpanda and as a result, has scaled down operations. Foodpanda, sources say, is currently shifting its focus towards its cloud kitchen brands. Interestingly, the number of restaurants on the app have considerably reduced. When TNM checked in Mumbai, Hyderabad and Bengaluru, there were less than 5 restaurant options across locations, while its cloud kitchen brands were available.
Ola says that it is rapidly expanding network of kitchens. “Many of these offerings are already available in all major cities through the Ola and Foodpanda apps. We continue to invest in expanding our facilities and kitchens, as well as our portfolio of food offerings for customers. We remain committed to our mission of building a superior food experience for millions of our customers,” a company spokesperson said.
Foodpanda currently owns three cloud kitchen businesses -- Great Khichdi Experiment, Grandma’s Kitchen and FLRT. Sources say that there are 50+ kitchens currently operational across Bengaluru, Chennai, Delhi and Mumbai. As part of the same strategy, Ola is also looking at opening offline stores for these cloud kitchen brands and is hiring people with culinary experience.
However, according to Mint, FoodPanda has also laid off 40 mid-to-entry level employees, and most of its food delivery executives have also been terminated. Mint quotes sources as saying that Ola has dissolved the ground team completely and that only the core team consisting of senior employees is being retained.
Foodpanda was founded in 2012 and was then sold off to Delivery Hero in December 2016. However, it struggled to keep the FoodTech company afloat amidst severe competition from the likes of Swiggy and Zomato. In just a year, Ola bought FoodPanda’s India business for nearly $50 million in December 2017 and at the time, committed $200 million into the food delivery arm.
In December 2018, FoodPanda announced that it was present in 100 cities with over 6,00,000 restaurant partners and 1,20,000 delivery executives on board.
In October 2018, it acquired Mumbai-based food-tech venture Holachef, which marked Foodpanda’s entry into cloud kitchens.
The FoodTech industry, which at its inception was a crowded market has now evolved with Swiggy and Zomato leading the race. UberEats and FoodPanda, which were the only other players competing with Swiggy and Zomato are now struggling. Reports suggest that Uber India too is looking to sell off UberEats.