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Ola shuts down its food and grocery delivery business


Online cab aggregator Ola has shut down its food and grocery delivery businesses Ola Cafe and Ola Store. The company confirmed the development on its blog.

“The Ola Store app and Ola Café category on the Ola app will not be available from this week onwards. We understand that you will miss receiving your favorite food or your daily groceries within minutes from our respective services. But then, all good experiments have to come to an end and we are happy that you were part of this journey,” the company said.

Ola had launched Ola Cafe last year and offered users lunch, snacks and dinner as part of its service. The service was live in Mumbai, Hyderabad, Delhi and Bangalore. It did not provide users with an extensive menu to choose from but rather offered a few particular items from a handful of restaurants in the customer’s vicinity, with a focus on quick delivery.

Ola Store debuted in Bangalore in July last year.  Users had the option of setting their preferred time slot for delivery and the ‘Deliver Now’ option where orders are delivered in 90 minutes. The service delivers groceries from neighbourhood stores such as Family Mall, Grocery Mart and Namdhari’s Fresh.

A Mint report quoting sources said that  though Ola Café scaled up in the first few months after the launch, it failed to meet expectations as the vertical faced stiff competition from other food delivery businesses such as Swiggy, Tinyowl and Zomato.

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Launch of bike taxis and other transportation solutions 

– Earlier this month, literally hours after rival Uber launched bike taxis, Ola anounced its bike taxi service. However, Bangalore’s Commissioner for Transport & Road Safety, Dr Ramegowda told MediaNama that Ola and Uber have to go to the Road Transport Authority (RTA) of the state to obtain permission in order to operate in the city and as such their operations are illegal.

– In February, Ola slashed prices for Ola Auto in Indore and Ahmedabad. The company also introduced Ola Share, Shuttle and Autos in Uttar Pradesh after signing a memorandum of understanding with the state. Ola Shuttle announced that its service will now be available for corporate customers who sign up via Ola Corporate, its business solution for companies which would allow their employees to get an Ola cab. Ola introduced a new price point for its customers in Mumbai called Ola Micro. According to company’s website, the new price category will be available select users in Mumbai and cab fares will start at Rs 45 and subsequent kilometers will be charged Rs 8.

Consolidation in the online grocery space

– Earlier in February, Flipkart  shut down its grocery delivery service Nearby five months after its launch.

-In the same month, hyper-local grocery delivery service PepperTap shut down operations in six cities: Mumbai, Kolkata, Chennai, Ahmedabad, Chandigarh, and Jaipur. It laid off about 400 delivery personnel. In December, the company raised $4 million from Innoven Capital, and acquired Bangalore-based hyper-local grocery delivery service Jiffstore.

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– In January, Grofers shut down its services in 9 cities citing low acceptance. The company had expanded to these Tier II cities, including Ludhiana, Bhopal, Kochi, Coimbatore and Visakhapatnam in September 2015. Grofers will now operate in 17 cities.

– In November 2015, Indian Grahak, the Kolkata based online supermarket,acquired online hyper-local marketplace Dyscover in a cash and stock deal.

– In September 2015, Delhi-based AUTOnCAB, a cab and auto booking service, acquired the Gurgaon-based online grocery delivery startup BigZop in a stock and cash deal.


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