• Wednesday, April 17, 2024
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DropX shuts down after 2 years of operation

DropX shuts down after 2 years of operation

DropX, a delivery oriented startup, has announced their shutdown after two years of operation.

This move comes at a period when many other startups are closing or grappling with the country’s challenging economic climate.

DropX, founded by Praise Alli-Johnson and Oluwatope Liasu in 2021, began with a plethora of plans to achieve their goals – to connect businesses and individuals with swift and reliable delivery services.

While these goals were achieved at the beginning, with over 2,000 users enticed by free initial deliveries, revenue generation tanked as the years went by.

Praise Alli-Johnson, in a statement explained the many issues the organisation had to deal with. He intimated that the problems began when there was a gap between driver pay expectations and what users were willing to pay.

“We aligned our prices with those of Bolt and catered exclusively to high-value customers dealing with bulk food deliveries, cakes, luxury goods, etc as this market segment cared more about the item’s condition than the cost,” he said.

He also established that the problem worsened because all customers wanted cheaper deliveries at the introduction of bikes as opposed to the prices of cars.

“With both bikes and cars on the platform, everyone wanted cheaper deliveries. Requests for bikes skyrocketed, and requests for cars dropped, even the high-value clients that started using DropX because we were using cars. People, shaa. At this point, bikes weren’t enough, so we are back to the problem of high demand and failed requests.”

Alli-Johnson also mentioned the people problem. He said, “some users engaged in off-app deals with drivers, taking cash off the app. Same users call to complain, thus snitching on themselves. Initially unhappy about losing revenue, I found a silver lining as we didn’t have to cover the delivery difference.”

He also said the company was contacted by Nigeria Postal Service (NIPOST) to explore the possibility of a collaboration.

In his words, “the idea pitched was for DropX to provide the tech infrastructure and bike investment schemes to get more bikes into the system, while NIPOST manages bikes and drivers, and they both share in-app charges for delivery.”

“We pitched and pitched to different groups within NIPOST for months on end. This is the end of 2023, and I am burned out, not seeing myself doing this in 2024,” Alli-Johnson said.