Jokr, a young rapid-delivery company that calls itself “the future of supermarkets,” is ceasing operations in New York and Boston and refocusing on the Latin American market, which company executives say should be more profitable.
“We have decided to stop our business activities in the U.S. for now, which have lately only accounted for about 5% of our business,” Chief Executive Ralf Wenzel said in a prepared statement Wednesday (June 15) quoted by Bloomberg News. “Latin America is particularly underpenetrated and underserved, that’s why Jokr has put its focus and emphasis on the Latin American opportunity since the beginning.”
The company also indicated it plans to close nine fulfillment centers, leaving around 190 worldwide, and cut 50 workers, or about 5% of its global workforce.
According to Jokr’s website, the company has a New York City base in addition to its headquarters in Luxemburg. Bloomberg reported that Jokr will keep some New York employees even as it stops serving customers in the city.
Bloomberg reported that Jokr also ended its delivery service in Europe previously but continues to do business in Brazil, Chile, Colombia, Mexico and Peru.
TechCrunch reported in March that Jokr raised $260 million in Series B funding at a valuation of $1.2 billion.
See also: Rapid Food Delivery Businesses Pick up Advertising Side Hustle to Make Ends Meet
In May, Jokr sought to increase revenue by selling advertising on its app and on drivers’ delivery bags.
Ultrafast grocery delivery companies like Jokr are struggling with the economics of their model. One report estimated these on-demand delivery services lost as much as $20 per order.
Some of the challenges online grocery services face are outlined in a May 31 PYMNTS report called, “The Tailored Shopping Experience: Meeting Consumers’ Online Expectations.”
See report: Grocers Must Offer Personalized eCommerce Experience, Data Reveals
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