Germany’s Delivery Hero Predicts Rosy Revenue Forecast

Delivery Hero

Germany’s Delivery Hero says its 2021 revenue outlook looks positive, as the online food delivery service reaps the benefits of investing in food delivery and quick commerce.

As Reuters reported on Thursday (Nov. 11), this announcement comes amid a consolidation wave in the home delivery sector, which has boomed during the pandemic.

Among those consolidations: DoorDash’s recent $8 billion deal to acquire the Finland-based Wolt, a food and retail delivery service operating in 23 countries.

Read more: With Acquisition of Wolt, DoorDash Aims to Take on Uber Eats’ Global Reach

“We started in food delivery logistics, and our vision was always to build a platform that supports all of local commerce and to do it on a global basis,” DoorDash CEO Tony Xu said on a call with analysts earlier this week. “We believe these markets provide an opportunity to grow our international business to multiples of what it is today. This should allow us to invest and expand more efficiently than we could have done on our own, and on a faster timeline.”

According to Reuters, Delivery Hero CEO Niklas Oestberg said his company had been involved in the deal initially, but backed away from making an offer. He said the deal would not impact Delivery Hero materially, as its operations in Europe make up less than 7% of its business. But Oestberg said the DoorDash/Wolt deal could affect other players in Europe, as the price of the purchase could signal other American companies wanting to break into the market.

Read more: Germany’s Delivery Hero Buys Minority Stake in Gorillas Delivery Startup

“We looked into the numbers, but we decided not to participate in an offer, as we understood that the price expectation was way beyond what we could actually pay,” Oestberg said.

His company expects to report revenue and gross merchandise volume for 2021 that’s at the upper end of its previous forecasts. Part of that reason is the growth in the company’s Dmarts which are centrally located warehouses for online clients from 704 at the end of June to 861.