Amazon Will Close India's Food Delivery Service.

Amazon will close India’s food delivery service.

Amazon India

It announced Friday that Amazon India would close its food delivery service by the end of the year. This retreats from the $20 billion vertical it entered less than three years ago.

Amazon Food, India’s food delivery service, will be shut down by the retailer on December 29. It launched Food in India in May 2020 in Bengaluru. It later expanded the service to other parts of Bengaluru and partnered with additional restaurants. However, it did not heavily promote or market the platform.

“Customers have been telling our company for some time that they want to order ready-to-eat meals from Amazon and all their other necessities. This is especially relevant now as they are safe at home,” the company stated at the Food launch.

According to Sanford C. Bernstein, India’s food delivery market will be worth $20 billion within three years. Zomato, which is publicly traded, has a slight lead over Swiggy. This market leader is supported by SoftBank, Proses Ventures, and Invesco.

Amazon stated Friday that it does not take these decisions lightly. These programs will be discontinued in phases to protect our current customers and partners. We will also support the employees affected by this transition. Amazon is committed to providing our customers with the best online shopping experience, with the most products and the most excellent convenience.

This announcement is part of Amazon’s more extensive restructuring in India. It had earlier announced that it would close down its edtech service Academy within the country next year.

Amazon has invested over $6.5 billion in India’s local businesses. India is Amazon’s critical overseas market. According to a Sanford C. Bernstein report, the company is behind Walmart’s Flipkart. It also struggles to make inroads into smaller Indian towns.

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According to analysts, Amazon’s 2021 gross merchandise worth in the country was between $18 billion and $20 billion. According to a report to clients, this is less than Flipkart’s $23 trillion.

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