Report: Getir Faces Investor Pressure to Cut Costs and Restructure

Getir, the Turkish grocery delivery company that soared in value during the pandemic, is reportedly grappling with the need to cut costs and restructure as demand for its services wanes.

Investors are pushing for significant changes within the company, including asset sales and market exits, Bloomberg reported Thursday (April 18), citing unnamed sources.

Getir did not immediately reply to PYMNTS’ request for comment.

During the pandemic, Getir experienced a surge in business as customers relied on its services while confined to their homes. However, as the world began to reopen, the demand for grocery delivery diminished, according to the report.

In response, Getir is now exploring options to sell off or shutter assets in non-core markets, with its operations in Turkey being exempted, the report said.

The company said in July that it planned to exit three European markets — Italy, Portugal and Spain — as it focused on profitability.

Advisors to Getir are expected to present restructuring options to the company and its investors within the next two weeks, per the report. The extent of job cuts will depend on whether operations are sold or closed. Additionally, Getir has been engaged in merger discussions with German rival Flink.

Investors have poured over $2 billion into Getir to date, according to the report. Last year, the company reduced its global workforce by more than 10% due to financial difficulties. In September, Getir raised $500 million at a valuation of $2.5 billion.

If Getir decides to exit the European market, it would leave less than half of the rapid grocery startups that flourished in the region during the pandemic, the report said.

These startups, which offered a limited selection of groceries through apps and utilized couriers on mopeds or bicycles, faced challenges in achieving profitability, per the report. High labor costs, operating urban warehouses and consumer price sensitivity hindered their ability to boost their margins.

Ruth Lewis, a senior manager and retail specialist at Bain, told Bloomberg that the best case scenario for these startups would have been breaking even.

It was reported Wednesday (April 17) that Getir rival Flink is receiving another 100 million euros ($106.7 million) from investors to extend its runway and try to outlast its competitors. Flink is also in discussions with rival food delivery companies about a potential merger.