Norway’s Oda, an online grocery service, has recently announced its decision to cease retail operations in Finland due to unsatisfactory profitability. In light of this development, the company has initiated negotiations with its entire workforce of 165 employees in Finland. However, Oda will maintain its logistics services for other businesses operating in the country.
Oda made its entry into the Finnish market in early 2022, capitalizing on the surge in demand for grocery delivery services following the implementation of social distancing measures during the Covid-19 pandemic. Despite achieving a turnover of over 22 million euros in Finland over an 11-month period last year, the company incurred losses of nearly 24 million euros. Nevertheless, Oda experienced continuous growth with an annual sales rate of 34 million euros.
The company attributed its decision to inadequate profitability in the current market landscape, pointing to stricter terms demanded by financiers over the past year. Finland’s dominant players in the grocery delivery sector are the retail giants Kesko and S-Group, while Lidl, a prominent grocery store chain, has yet to venture into the home delivery market in Finland.
Oda’s CEO, Karl Munthe-Kaas, acknowledged the company’s impact on the Finnish online food shopping and home delivery scene, stating, “Oda managed to revolutionize online food shopping and home delivery in Finland. Unfortunately, the surrounding circumstances have changed, necessitating a new direction for Oda.” Munthe-Kaas emphasized Oda’s intention to leverage its highly efficient logistics and distribution technology, which is considered the most advanced in the world. As a result, Oda plans to operate as a logistics service company in new markets moving forward.
Immediate negotiations for restructuring with Oda’s personnel in Finland will commence, impacting the entire workforce of 165 employees in the country. The outcome of these negotiations may involve layoffs and terminations, as stated by the company. However, Oda’s operations in Norway and Germany will continue without interruption.