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36
Cost-cutting by firms – Post-Pandemic
By: Yousuf bin Muhammad H1
contrasting fortunes during this tumultuous period. While Foodpanda's
business model, characterized by minimal person-to-person interaction,
facilitated growth and expansion, Careem grappled with a significant decline
in demand and subsequent workforce reductions.
Foodpanda's Success Amid Crisis:
Foodpanda's business model centered around online food delivery, proved to
be well-suited to the challenges posed by the pandemic. With minimal
interaction between individuals, the company experienced a surge in demand
as consumers sought convenient and contactless meal options. This surge
propelled Foodpanda's growth, with both the business and its staff expanding
by an impressive 70%. However, as the initial wave of the pandemic subsided
and consumer behaviour shifted, Foodpanda encountered stagnation in
growth post-pandemic. Consequently, the company was forced to make
difficult decisions, including staff reductions, to adapt to the evolving market
conditions.
Careem's Struggles in a Changed Landscape:
In contrast, Careem, reliant on facilitating rides and transportation services
that necessitate close interaction between drivers and passengers, faced
significant challenges during the pandemic. Concerns over virus transmission
led to a sharp decline of 40% in nationwide trips for the ride-hailing giant. The
drop in demand, coupled with ongoing health and safety protocols, strained
Careem's operations and financial viability. Despite implementing stringent
safety measures and diversifying services to include delivery options, Careem
struggled to regain momentum amidst lingering uncertainties and shifting
consumer preferences.
Adapting to Changing Realities:
The divergent trajectories of Foodpanda and Careem underscore the critical
importance of adaptability and resilience in navigating crises. While
Foodpanda's business model initially shielded it from the worst effects of the
pandemic, the company ultimately faced challenges as
ntroduction: The COVID-19 pandemic reshaped the business
landscape, with some companies thriving while others faced
unprecedented challenges. Foodpanda and Careem, prominent players
in the food delivery and ride-hailing sectors respectively, experienced
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