Russian Yandex shuts down online grocery shopping in Paris, hints at London exit

A Yango Deli delivery driver collects a test delivery ahead of the opening of their new store in London, Britain October 6, 2021. Picture taken October 6, 2021. REUTERS/John Sibley/File Photo

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March 31 (Reuters) – Russian internet giant Yandex (YNDX.O) is phasing out Paris operations of its online grocery service Yango Deli, a spokesman said on Thursday, citing poor performance and leaving hear that an exit from the London market could follow.

The service, which aims to deliver grocery orders in 15 minutes using darkstores – dedicated warehouses that only cater to online customers – also operates in Israel and under a different brand in its main market. of Russia.

“Yango Deli is gradually suspending its super-fast grocery delivery operations in Paris,” a Yango Deli spokesperson said. “This was a pilot project with a small number of darkstores, and it underperformed our internal targets.”

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The spokesman also said his London unit was the subject of interest from other parties.

“The superfast delivery market in London is very competitive and we are seeing considerable interest in our business there, including from our peers,” the spokesman said, adding that he could not give More details.

A source familiar with the matter said talks about closing the Paris operation, launched last summer, had been underway since early February, with the decision being performance-based.

In London, where the service started last fall, the source said Yango Deli is considering several scenarios, one of which is a possible sale, to preserve what the team has achieved.

The company operates five dark stores in London, with around 2,500 SKUs (stock-keeping units). Customer retention is at 40%, which Yango Deli says is about 1.5 times higher than the market average, according to its own estimates.

The London unit is operated locally by Deli International Limited, a UK company.

YANDEX’S TROUBLES

Nasdaq-listed and registered in the Netherlands, Yandex and its subsidiaries have so far avoided Western sanctions that have crippled Russia’s access to global financial systems and supply chains.

Former deputy chief executive Tigran Khudaverdyan resigned after the European Union imposed individual sanctions on him, which Yandex said it was shocked and surprised to learn.

The EU has criticized Yandex for warning Russian users looking for information about Ukraine on its unreliable internet information search engine. Read more

Meanwhile, the company reported that it lacked funds to cover a potential convertible bond buyback due to a suspension of trading in its Nasdaq-listed shares, while in early March a A data breach revealed users’ personal data on its food delivery app, Yandex.Eda. Read more

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Reuters reporting; Editing by Kirsten Donovan

Our standards: The Thomson Reuters Trust Principles.

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