Deliveroo to cut hundreds of jobs globally – with UK set to be hit hardest | Business news

The food delivery platform Deliveroo announced that it will lay off about 350 people, accounting for about 9% of the company’s total workforce.

global role Delivery Founder and chief executive Will Shu told staff that business would be affected, but it is understood UK staff will be the worst affected by the loss. Most of the staff are based in the UK.

Some employees will be transferred to different areas of the business in an effort to limit the loss to about 300 positions, while the layoff process will begin across the company.

In the UK, there will be collective bargaining on Deliveroo’s proposed job cuts, but all markets will offer “enhanced job cuts that go beyond government requirements and support”, Shu said. Details will vary by market, he added.

Deliveroo needs to “go further” to make the company profitable as the boom in COVID-era food delivery orders fades on the platform, company chiefs say.

The company’s latest quarterly results, released last month, showed it broke even and expected to be profitable this year.

Financial performance was helped by cost containment measures and higher customer fees after orders fell from the peak of the pandemic: Orders fell 2%, but that was offset by higher restaurant prices.

The job cuts were blamed on competition in the delivery industry and the state of the global economy. “We operate in a highly competitive industry, and at the same time, we are also in a difficult consumer environment in most of our markets,” Mr Shu said.

“We are experiencing record high inflation, rising interest rates, an energy crisis and fears of a UK recession.”

Will Shu will initially have 20 votes per share, while other stakeholders will only have one vote per share. Image: Deliveroo
Will Shu, Founder and CEO, Deliveroo

Like many tech companies and start-ups, Deliveroo said it was hiring rapidly during the pandemic and is now laying off staff. “Our headcount has grown very rapidly in recent years. This is in response to unprecedented growth rates supported by COVID-related tailwinds,” Mr Shu added.

He said the layoffs were his responsibility and that he should “take a more balanced approach to headcount growth”.

Listed on the London Stock Exchange in March 2021, the company is known as Worst IPO That’s in London’s history after the share price fell by a quarter and wiped £7.6bn off the total value of Deliveroo shares.

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But cost-saving measures in the final quarter of 2022 — including closing loss-making operations in Australia and the Netherlands — were not enough, as Shu said Thursday: “Frankly, our fixed cost base is too large for our business. big”

Deliveroo uses gig economy workers to deliver food – they are not considered employees and therefore cannot be made redundant.

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