Deliveroo Share Price Rises: Retail Investors Like the Stock, Employees Demanding Fair Wages

Dusan Vasic Image
ByDusan Vasic
April 15,2021

Deliveroo stocks rose on Wednesday, the first day after the initial public offering (IPO), retail investors had the opportunity to invest in the company’s shares. On the same day, Deliveroo drivers were protesting, asking for fair living wages for their work.

Deliveroo had an unsuccessful first day on the stock market. The IPO price dropped by 25% from the initial evaluation of $10.46 billion and $5.39 per share. However, the next day shares went up 2.1% to $3.95 as retail traders entering the market.

Spreadex analyst Connor Campbell said: “Though Deliveroo has risen... on the first day of trading available to retail investors, it’s too soon to tell whether this is a vote of confidence in the stock. The real test for the company is going to be the coming months.”

The unsuccessful stock market debut was followed up by protests, with thousands of Deliveroo riders gathering in London. According to the Independent Workers' Union of Great Britain (IWGB), the food delivery service is “the world’s most protested app-based platform.”

Almost a dozen major investment funds have decided not to invest in Deliveroo because of concerns over the company’s treatment of workers.

A spokesperson for the company said: “This small self-appointed union does not represent the vast majority of riders who tell us they value the total flexibility they enjoy while working with Deliveroo alongside the ability to earn over £13 an hour.” Deliveroo claims, according to an internal survey, that 88% of riders are happy with the company.

The poor stock performance is also attributed to big-time investors like Aviva and Aberdeen Standard Life deciding to pass on the opportunity to invest in Deliveroo. The investors cited concerns about the gig economy working conditions and disproportional board voting rights that would favor the company’s founder, Will Shu.

“One solution could be, for example, to offer part of the shares with more voting rights to those institutional investors interested in the business model of the British platform,” said the CEO of Cirdan Capital, Antonio De Negri.

Investors are still wary of how companies in the gig economy structure themselves, as workers are considered independent contractors without the benefits and legal protections employees will have.

More from news

The Spanish fashion retailer, Mango, announced its plans to open 30 new stores in the United States by the end of 2024. This is just a part of the retailer's global expansion, as there are also plans to open new stores in Europe and India. Although it had a lot of success in online sales during the pandemic, the company still believes that the brick-and-mortar experience is key to its growth.  The retailer currently has only six locations in the US and plans to start its expansion on Fifth Avenue in New York. The 2,100-square-foot flagship store is set to open in May. Besides this, the company targets Florida and has plans to open stores in Miami, Jacksonville, Orlando, and Boca Raton. This expansion will be followed by Texas, Nevada, Arizona, and California.  According to the company, the United States is currently a top-ten market, and the goal is to make it a top-five market. Last year, Mango had 2,447 stores worldwide, an increase of around 10% compared to 2020, and now the goal is to widen the market even more. Toni Ruiz, Chief executive at Mango, said: “The role of the store will evolve. We are sure that sometimes it’s more logistics, sometimes it’s more about experiences, but we are convinced human contact is very important.” One of the goals of this expansion is to enhance the shopping process and make it more interactive and engaging for customers. The customer will have the possibility to order eCommerce products while doing their in-store shopping.  There will also be a click-and-collect option for when they want to order products online and pick them up in-store. The company also plans to improve data collection to provide a more personalized experience for its customers. Mango wants to expand its homeware business to the US market, too. Laura Vila, the home director at Mango, commented on this, saying: “Entering the United States homeware market is a significant step forward in our strategy to diversify our business and at the same time strengthen our international expansion plan in one of the most strategic markets for the company.” 
By Julija A. · April 14,2022
According to a recent report, the Maersk eCommerce Logistics business unit is getting into business in the US in a push to capitalize on the $600B eCommerce market there. Maersk boasts a network of over 70 strategically placed e-fulfillment centers capable of delivering to 75% of the population in the US within 24 hours and 95% within 48 hours. Casey Adams, head of Maersk eCommerce logistics in North America, said the following in a recent press release:  “Business gets more competitive every day as US consumer online shopping demand continues to grow. Our fulfillment network is designed to bring B2C expertise and scale to Maersk customers with direct-to-consumer fulfillment, parcel delivery, and supply chain visibility in an end-to-end offering. By making eCommerce supply chains easier and more robust, we can deliver factory-to-sofa service.”  Before emerging in the US market, Maersk has rapidly expanded its eCommerce presence with recent acquisitions, purchasing Visible Supply Chain Management – a notable US-based eCommerce fulfillment firm in Salt Lake City, Utah. The company also acquired two European eCommerce firms: B2C Europe and HUUB and Asia's LF Logistics. Maersk hopes that the previous acquisitions will provide integrated logistics solutions in the North American market, especially in B2B warehousing and distribution. The Danish shipping company Maersk already has a significant presence in Europe and Asia, serving over 100,000 clients with B2B supply chains and transporting 12 million containers per year. Its services include order and transportation management, customs clearance, and a range of eCommerce fulfillment options. Its Californian-based branch, Performance Team (acquired in April 2020), will offer warehousing and distribution solutions and a full range of transportation services for the North American market. Mr. Adams and the Maersk team were in Las Vegas, Nevada, for the 2022 Shoptalk event from March 27-30. The agenda of the conference, which attracts over 8,000 people each year, covered the latest retail technologies, trends, and business models and discussed consumers’ behavior.   
By Nemanja Vasiljevic · April 06,2022
According to the National Retail Federation’s survey for 2020 and 2021, retail returns skyrocketed to over $760 billion in value.
By Vladana Donevski · March 14,2022

Leave your comment

Your email address will not be published.


There are no comments yet