Bolt Food is set to shut down its services in South Africa and Nigeria in December 2023.
Here’s why Bolt Food is shutting down in Nigeria and South Africa
The e-hailing and on-demand delivery giant recently confirmed the impending shutdown of its Bolt Food service in South Africa from 8 December 2023, and in Nigeria on 7 December 2023.
This decision aligns with the company’s broader strategy, following a significant increase in turnover but a continued operational loss.
In 2022, Bolt Technology’s turnover surged 152% to €1.26 billion, showing rapid growth despite operating at a loss of €72 million, which, in a greater context, is a notable reduction from over €547 million in the previous year.
Founded a decade ago, Bolt has diversified its offerings to include ride-hailing, e-scooter and car rental services, and a food delivery app, establishing itself as one of Estonia’s nine unicorn firms.
As reported by ERR, the bulk of Bolt’s 2022 revenue, nearly 80%, originated from its ride-hailing segment, underlining its core strength.
Geographically, Europe’s significance as a sales revenue source increased from 70% in 2021 to 81% in 2022. While revenues in African countries where Bolt operates rose, their contribution to total revenue declined.
The company’s financials for 2022 also revealed a focus shift, with close to 80% of sales revenue derived from driving services, 10% from rentals, and 9% from food delivery.
Operating losses decreased 11% year-on-year to €262.6 million, and the operating profit margin improved significantly.
Bolt’s strategic decision to exit the food delivery market in South Africa and Nigeria reflects a realignment towards its more profitable segments.
Despite the food delivery arm’s closure, Bolt remains fully committed to its other verticals in these regions, focusing on delivering high-quality services to its customers.
The launch of Bolt Food in October 2021 in Lagos was aimed at capturing the booming food delivery market, competing with players like Jumia Food and Gokada.
In South Africa, the service’s cessation will impact both customers and couriers, with the company ensuring a smooth transition for all involved parties.