‘Stomped on and ruined’: Another food delivery service collapses

It’s been a horror 2022 for food delivery services in Australia, and before the year finishes there has been yet another casualty.

A horror 2022 for food delivery services in Australia has seen yet another casualty, with a popular online grocer shocking customers by announcing an almost instant closure.

On Wednesday, Melbourne business YourGrocer, which offers grocery delivery from local independent shops, told customers it was “closing down for good”.

“It is with a heavy heart that we must announce that YourGrocer is closing down for good as a company this Friday (December 16),” YourGrocer founder and chief executive Morgan Ranieri wrote.

“This will be our very last day of deliveries. As hard as we’ve tried, we cannot keep the company going any longer, so we have been forced to cease operating.”

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Morgan Ranieri, co-founder of Melbourne start-up YourGrocer. Picture: Stuart McEvoy

All orders from Monday will be cancelled, likely torpedoing some people’s Christmas plans.

“We sincerely apologise for the inconvenience and disappointment,” Mr Ranieri said.

The company was pushing Christmas orders on social media as late as Monday.

“One week left to lock-in your Christmas Centrepiece: Perhaps a smoked ham (half or full) from North Carlton Quality Meats is the star of your spread?” it had posted to Facebook.

“If you haven’t reserved your Christmas delivery slot yet, there’s still a handful left.”

The service appeared popular among its users, with many praising its service and usability, saying they were sad to see it gone.

“Great company that allowed ordering from local small businesses directly. Also – when the Woolies/Coles duopoly have been unavailable in recent years, these guys were a lifesaver,” one customer said.

Morgan Ranieri (right) from YourGrocer apologised for ‘the inconvenience and disappointment’. Picture: Kylie Else

“The level of service and quality of the produce was outstanding and something the big supermarkets could never equal. So sad to see yet another small business stomped on and ruined,” another said.

The latest closure follows the demise or downturn of several food delivery services this year.

In June, the $75 million-backed grocery delivery start-up Milkrun scaled back its delivery promises as it reported a $13 loss per order.

Victorian food delivery company Delivr, styled as a rival to UberEats and Deliveroo, collapsed in July after becoming unprofitable.

And just weeks ago, delivery giant DoorDash laid off 1250 staff as challenging market conditions bit.

The company said it had scaled up rapidly during the Covid-19 pandemic when its services were in demand, but now it was forced to correct.

DoorDash CEO and co-founder Tony Xu. Picture: David Geraghty

“Most of our investments are paying off, and while we’ve always been disciplined in how we have managed our business and operational metrics, we were not as rigorous as we should have been in managing our team growth,” Tony Xu, DoorDash’s chief executive officer, said in a statement.

“That’s on me. As a result, operating expenses grew quickly,” he said.

“Our business has been more resilient than other e-commerce companies, but we too are not immune to the external challenges.”

In November, Deliveroo also announced it was shutting down its Australian operations as it was failing to turn a profit.