Popular food delivery service Menulog to CLOSE in Australia due to ‘challenging circumstances’ – as 120 jobs are axed
Menulog is pulling the plug on its Australian operations after 20 years, as experts reveal why the food delivery service’s downfall was inevitable.
Up to 120 employees will receive redundancy packages as well as outplacement support as a result of the shock closure.
‘After careful consideration, we have made the difficult decision to cease our operations in Australia,’ Menulog said in a statement on Wednesday.
‘While Menulog has a proud 20 year history, it has been navigating challenging circumstances.
‘This strategic decision reflects our focus on accelerating growth and investments in other markets and to deliver the best experience for customers, partners and couriers.’
The Menulog platform, which was acquired by Just Eat in 2015, will remain active until November 26 at 11.59pm.
The delivery service was known for their extravagant advertisements with celebrities, including Snoop Dogg, Katy Perry and Christina Aguilera.
Professor of Marketing and Consumer Behaviour at the Queensland University of Technology, Gary Mortimer, said Menulog had failed to recover the pandemic.
Menulog, which owns Just Eat Takeaway.com, will close its Australian operations
The brand was known for their extravagant advertisements with celebrities such as Snoop Dog
‘During the pandemic, we saw lots of online, fast delivery service providers pop up like Menulog,’ he told Daily Mail on Wednesday.
‘Three years later, Australians are simply going out to eat like they used to and the need to have meals delivered has dissipated.
‘They didn’t future proof their business to think “What happens when people actually go out and start dining again?”‘
Professor Mortimer said restaurants are ‘starting to fight back against the absorbent fees’ that come with using delivery services.
‘Anywhere between 15 to 30 per cent of the price is charged to a restaurant before providing that service,’ he explained.
‘We may find restaurants actually hiring a scooter and employing their own person to do some of the delivery.’
Asked about whether celebrity endorsements from figures like rapper Snoop Dogg would have had an impact on Menulog finances, Professor Mortimer agreed.
‘They had a big advertising spend, which would imagine eroded profits towards the back end of their time, but it was strategic for them to differentiate themselves to other providers that offered exactly the same service,’ he said.
The closure of Menulog in Australia will affect approximately 120 employees
Menulog was founded in Sydney in 2006 and was acquired by British company Just Eat in 2015. It was combined into Dutch-based Just Eat Takeaway.com five years later in 2020.
Managing director Morten Belling said the priority now is to support our customers, couriers and partners.
‘Today is a tough day for the Menulog business and I would like to reassure everyone this decision was not taken lightly,’ he said in a statement.
‘We are providing everyone a two-week transition period, in which customers can redeem unused vouchers and credits.
‘Additionally, eligible couriers will be entitled to a four-week voluntary payment.’
Delivery services DoorDash and UberEats are the remaining two mainstream companies operating in the Australian market.
‘To maintain some level of competitiveness in the market, either one of them are going to have to start to look at their fees and potentially reduce their fees,’ Professor Mortimer added.
‘Ultimately, sitting at home and having your vindaloo delivered to you may slowly be disappearing as we are keen to actually re-socialise and eat out again.’
