Deliveroo has no appetite for China’s ‘competitive’ food delivery market

Online food delivery giant Deliveroo is reluctant to enter China because it sees it as a highly competitive market, according to its founder and CEO.

“China is a very well served market already, with a lot of competition there,” said Will Shu, a former investment banker who founded the company in 2013, when asked if Deliveroo had any plans to take its business to the mainland.

The UK-based start-up’s apparent lack of ambition in the Chinese mainland stands in contrast to a host of other foreign technology companies who have tried and failed to get a foothold. They often face huge disadvantages against domestic competitors thriving in an environment geared to their success.

Uber sold its China operations to its main rival Didi Chuxing in 2016, having carved out a meagre 8 per share of the ride-hailing market, compared with Didi’s 85 per cent.

Google, EBay, Amazon and Facebook have all attempted to tap the mainland’s enormous potential, with disappointing results.

The food delivery market in China is currently carved up largely between just two dominant providers, Meituan-Dianping and Ele.me. According to consultancy firm iiMedia, the former accounts for 55.3 per cent of market share and the latter 41.3 per cent.

Tencent-backed Meituan-Dianping says that the country now has about 300 million people who use online delivery services.