The Norwegian online grocery service Oda has announced plans to end its retail operations in Finland, due to poor profitability.
The company said it is starting negotiations with all 165 of its employees in Finland and that it would continue to offer its logistics services to other companies in the country.
Oda started operations in Finland at the beginning of last year, as the grocery delivery market boomed following months of social distancing guidance during the Covid-19 pandemic.
The company said its turnover in Finland during the 11 months of last year amounted to more than 22 million euros but losses reached nearly 24 million euros. However, growth was continuing at an annual sales rate of 34 million euros, according to the firm.
Profitability in the current market environment is not adequate, the company explained, citing financiers' stricter demands on terms over the past year.
Finland's largest grocery delivery providers are the Kesko and S-Group shopping giants. On the other hand, grocery store chain Lidl has still not entered the home delivery market in Finland.
"Oda managed to raise the bar of online food shopping and home delivery in Finland. Unfortunately, the world around us changed and Oda now has to take a new direction accordingly," the company's CEO Karl Munthe-Kaas said in a press release issued on Wednesday.
"In the future, we want to make more extensive use of our logistics and distribution technology, of which we have developed the most efficient in the world, and therefore we plan to operate in new markets as a logistics service company," he continued.
Restructuring negotiations with the company's personnel in Finland are to begin immediately and will affect all of its 165 employees in the country.
The possible results of the negotiations may include layoffs and dismissals, according to the company, which added that its operations in Norway and Germany will continue as normal.
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