Ola shuts food and grocery delivery services

The move comes at a time when its rival Uber is trying set up a local engineering centre in Ola's hometown Bengaluru

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Homegrown app-based taxi aggregator Ola has shut its hyperlocal food and grocery delivery services, Ola Cafe and Ola Store, after they failed to attract enough users.

Launched in March last year, the services looked at better utilising its driver network while also tapping into the then booming hyperlocal delivery space.

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The move comes at a time when rival Uber is trying to set up a local engineering centre in Bengaluru, with an aim to harness talent and build customised solutions to help it leapfrog Ola.

Ola Cafe was available in four cities and accessible within the main Ola app. Ola store, a separate app was available in three cities.

“We understand that you will miss recieving 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,” Ola said in a blog post on Thursday.

With a very limited selection of dishes from nearby restaurants on its Ola Cafe menu, the company was not able to keep up with competitors Swiggy, Zomato, TinyOwl and FoodPanda.

India’s food and grocery delivery spaces had seen a massive influx of funding in the first half of 2015 but hit a speedbreaker after investors cracked the whip on the exuberant cash burns of these companies. Customers flocked to the idea of getting hot meals and groceries delivered home through the massive discounts these players offered. Ola also joined the party, but with Uber hunting it down in the taxi hailing business, the Softbank backed Indian firm is renewing its focus on its core business.

“As we strengthen our focus on building mobility for a billion people, we are drawing these two experiments to a close and taking learnings from these to serve you better in the time to come,” Ola’s blog post said.

Ola took a bet to diversify its business with Ola Cafe, Ola Store and Ola Money last year, but it seems as though nothing has paid off. All of the services have failed to create ripples in the market and function in extremely crowded spaces of food and grocery delivery and mobile wallets.