Food delivery service Foodora to close down in Canada on May 11, citing strong competition

Food delivery service Foodora says it will no longer do business in Canada as of May 11.

The company delivers cooked meals from restaurants to customers who order them on a smartphone app, taking a cut of the sale. It competes in Canada with services such as DoorDash, UberEats and SkipTheDishes.

Foodora is a subsidiary of German company Delivery Hero, which runs various food delivery services in 44 countries around the world.

Foodora launched in Canada in 2015. At last count, Foodora operated in 10 cities across Canada and had more than 3,000 restaurants on its menu, but the company said it isn’t making enough money in Canada to stay open.

“We’re faced with strong competition in the Canadian market, and operate a business that requires a high volume of transactions to turn a profit,” the company said. 

Unionization fight

“We’ve been unable to get to a position which would allow us to continue to operate without having to continually absorb losses.”

Foodora had also been engaged in a high-profile fight with its delivery drivers and riders, who voted on unionization last fall. The company challenged that ruling by arguing its delivery people are not employees but independent contractors.

The Ontario Labour Relations Board rejected that argument in February, and the results of the unionization drive were set to be revealed soon.

Foodora drivers had voted to unionize with the Canadian Union of Postal Workers, who did not immediately respond to a request for comment.

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