EGYPT – Spanish startup Glovo that offers on-demand delivery services has revealed that it is going to invest US$5.5 million in the coming 18 months in its expansion strategy.
The company, according to an executive at the Egyptian subsidiary, is targeting 50% of the online delivery market in Egypt within the 18 months
According Mustafa Kamel, sales manager at Glovo Egypt, Glovo’s market share in Egypt currently stands at 21%.
“Our target by the end of 2020 is to cover 16 cities in Egypt,” Kamel said adding that Glovo had so far invested about US$8.89 million since it launched operations in Egypt and plans to add another US$5.5 million in the coming period.
Although 75% of customers in Egypt still depend on call centres, Kamel believes there is a promising market in Egypt, especially with the growth of the smartphone market which will make it easier for customers to transition to the online market for deliveries.
“Food accounted for 95% of orders when we started working in Egypt. Currently, the percentage has dropped to about 72%,” Kamel said.
The Spanish based startup was founded in 2015 and currently operates in 28 countries globally and announced in May this year that it was going to suspend its Chilean operations indefinitely due incurring huge amounts of losses in the market.
The company entered 2018 and was mainly delivering food to customers. At the onset, Food accounted for about 95 percent of its orders.
The companies whose activities in Egypt are currently limited to the capital Cairo and Alexandria, the second-largest city, has however noted that the percentage of food orders has dropped to 72% due to diversification to other forms of deliveries.
In Africa, apart from Egypt, Glovo also has operations in Kenya, Côte d’Ivoire, and Morocco and has plans to expand to other markets in both East and West Africa.