Food delivery companies Glovo, Uber Eats ordered to open offices in Kenya

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Online food delivery companies, Glovo and Uber Eats have been ordered to open offices in the country by the Kenyan competition watchdog, the Competition Authority of Kenya (CAK). The competition authority said this was necessary for effective complaint resolution. 

The authority said this became necessary following a survey which revealed that the resolution of complaints by these companies, mostly operated from abroad, is slow and often delayed. This delay, according to the authority, was blamed largely on the absence of physical offices in the country where customers can walk in, make their complaints and get prompt resolutions.

The study finds that various challenges were registered with having the head offices of the platforms outside Kenya, including lengthy redress processes as some of the user complaints have been handled from the headquarters of the platforms. Customer service offices are often unreachable and emails may go unanswered for days,” the CAK said in a statement.

“To enhance and facilitate the timely resolution of consumer issues as well as value chain issues including competition issues, the platform should have country offices domiciled in Kenya with powers to resolve these issues promptly.”

Competition Authority of Kenya

This is how Glovo's Oscar Pierre plans to build its Nigerian businessThis is how Glovo's Oscar Pierre plans to build its Nigerian business
Glovo CEO, Oscar Pierre

Developing a regulatory framework for food delivery companies

Aside from directing the food delivery companies to open offices in the country, Kenya’s competition watchdog also advocated for the setting up of a framework for self-regulation. The authority said this would be necessary, especially in the absence of a legal framework governing the operations of these online food and grocery delivery companies in the country.

This is ever more required as complaints continue to flood in from consumers concerning the quality of service they are getting. According to reports, the most frequent complaint against food delivery companies is delays in the delivery of orders which makes up about 33 per cent of all complaints.

Other common complaints against online delivery companies include the non-disclosure of the full price information, delivery of the wrong product, additional delivery charges, price over-charge, and delivery of spoilt food.

However, it appears that many Kenyans aren’t able to even file complaints against the companies as only 16 per cent of consumers have filed complaints against the companies. This has largely been blamed on the non-availability of channels to lodge these complaints which had made it quite onerous.

Jumia Food to shutdown in Nigeria and six other African countries from December 2023Jumia Food to shutdown in Nigeria and six other African countries from December 2023
Jumia Food is the only food delivery company with offices in Kenya

Jumia Foods is the only food delivery company which has an office in Kenya, with its country headquarters domiciled in the capital, Nairobi. Glovo which happens to be the biggest food delivery company in Kenya has its headquarters in Barcelona, Spain.

Uber Eats has its headquarters in San Antonio, Texas, USA. Bolt Food is of course headquartered in Tallinn, Estonia and even Jumia Foods is headquartered in Berlin Germany.

Kenya’s food delivery boom and ensuing competition

Kenya has witnessed a boom in food delivery with the pandemic playing a key role. As millions of citizens stayed indoors to prevent the spread of the virus, food delivery services saw a gap and soon filled it. Statista forecasts that the East African country’s meal delivery segment will generate $306.70 million in 2023.

But with these opportunities came rivals, and Uber Eats, which was the biggest player at some point, suddenly found itself with plenty to deal with recently. It now competes with the likes of Bolt Food, Jumia Food, and Glovo, all fighting for available market share in the food delivery sector. Presently, Glovo enjoys the largest chunk of the market share, unseating Uber Eats in the process.

Food delivery companies Glovo, Uber Eats ordered to open offices in KenyaFood delivery companies Glovo, Uber Eats ordered to open offices in Kenya

In the face of stiff competition, Uber Eats was forced to diversify its offering, expanding its services to include delivery of alcohol, drugs and house supplies in Kenya. This was part of the food vertical’s efforts to remain competitive in the Kenyan market, meet changing consumer demands and weather the storm of stringent regulatory policies.

The General Manager of Uber Eats in Kenya, Wangui Mbugua who made the announcement at the time, claimed that the diversification of service delivery was “inevitable.” She pointed out the importance of businesses to explore other sectors in their bid to diversify revenue streams.

See also: Uber Eats Kenya now delivers alcohol and medicine amid growing competition from rivals


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