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Uber, which launched its Uber Eats home delivery platform in August 2014, recently announced that they will discontinue this service in Brazil.
According to a press release, the Uber Eats service will be available until March 7 in the South American country. After this date, people in Brazil can only use the application to buy in supermarkets and wholesalers through Uber’s Cornershop. They will be able to buy items including stationery, pet products, drinks and decorations.
Uber also said that all of its passenger transportation and ride-sharing services will keep operating normally.
A Strategy for Efficiency
Uber is not the only company in Brazil that does food deliveries. Brazilian delivery unicorn iFood and the Colombia-based Rappi are strong competitors. However, Uber’s renewed strategy to cease unprofitable operations can explain this decision.
It was only in November 2021 that Uber’s food delivery division reached profitability for the first time globally. It is a complicated business due to the high fees that Uber Eats charges restaurants. As a result, businesses are increasingly looking for more alternatives to offer their delivery service at a better cost.
The closure of Uber Eats in Brazil is also a sign that it will take advantage of Cornershop, since it acquired this Chilean company in 2022 for US$3 billion dollars. Both Cornershop by Uber, which specializes in grocery and wholesale deliveries; and Uber Flash, which focuses on package delivery will supply Uber Eats.
It will also seek the expansion of Uber Direct, a corporate product that allows stores to make same-day deliveries to their customers.
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