AFRICA—Bolt Food Service, the food delivery arm of the ride-hailing company Bolt, has announced the closure of its operations in Nigeria and South Africa.
According to TechCabal, a Nigerian technology journal, Bolt Food Service will discontinue operations in South Africa on December 8, 2023, and in Nigeria on December 7, 2023.
Bolt Food is currently accessible in Cape Town and Johannesburg in South Africa, as well as Lagos in Nigeria.
Despite its presence in these key cities, the corporation has decided to exit two of Africa’s major markets for strategic reasons.
This move aims to streamline resources and maximize efficiency amid a significant increase in turnover and persistent operating losses.
“The decision to exit this market is necessary to streamline our resources and maximize our overall efficiency as a company. This means our users will not be able to place Bolt Food orders through our food app from December 8,” noted the Bolt spokesperson.
Bolt Technology reported a substantial loss of €547.2 million (US$598.8 million) in fiscal year 2022, despite a 126% increase in turnover.
The company’s financials for 2022 indicate an 11% decrease in operating losses and an improvement in the operating profit margin.
Despite the challenges, Bolt remains fully involved in its other business sectors in these regions, affirming its commitment to providing clients with top-notch services.
Last year, driving services accounted for approximately 80% of Bolt’s sales revenue, followed by rentals at 10% and food delivery at 9%.
While Bolt Food’s exit from the South African market will impact both customers and couriers, the company is focusing on facilitating a smooth transition for everyone involved.
In South Africa, the food delivery sector is witnessing new entrants, despite being dominated by two major players: Mr D Food and Uber Eats.
The departure of Bolt Food SA adds an interesting dynamic to this competitive landscape.
However, macroeconomic challenges such as rising petrol prices, inflation, and the economic crisis are currently affecting the food delivery sector in South Africa.
These issues have drawn increased scrutiny, especially since the Competition Commission’s implementation in 2020, impacting various digital industries, including online delivery businesses.