Wolt – Shame or Fame?

Your correspondent admires the innovative and hardworking people who create valuable goods and services for consumers. Finland is a tiny market, which means that very few startup companies can succeed to become profitable when revenues cannot cover the costs of their investments and salaries. Finnish companies have the same costs as big countries without the opportunities of bigger national markets and more investors willing to risk the euros.

It is really tough for Finnish startups to expand into the bigger markets in Europe, in the USA or in Asia. The barriers of language, regulations, costs, and investor caution make this transition a Herculean task for small companies. 

There is no guarantee of success, but plenty of promise of failure.

This last week we have seen that Wolt, a Finnish-based food delivery company, has been able to raise over €400 million to finance its expansion Europe. The news is exciting for the founding owners, who see a huge increase in the value of their investment, and for the media that can now  publish this rare success story of how one startup has managed to cross the first milestone in  conquering of the world.

However, walking around Helsinki you will see Wolt delivery men, (I have only seen one delivery lady), either braving the snow and ice on bicycles with the big blue boxes strapped to their backs or in small second-hand cars parking illegally on the kerb working furiously to deliver the next pizza or Subway sandwich for a few Euros for each delivery.

The work is physically hard and demands many extra hours beyond what ordinary workers perform anywhere in any of the Nordic countries. Most of the deliverymen are immigrants who are probably unable to secure other work because they do not speak Finnish, have a poor education or simply because of they are coloured immigrants. Finland is not an easy place for such foreigners to find work, especially during the first years of arriving. 

These delivery men and women deserve the highest level of respect because they are not sitting at home and complaining. They have made a decision that doing this is acceptable because they see this as their responsibility to do honest work, even if they know in their hearts that their employers are taking advantage of the plight.

The work is tough, low paid and demeaning given the fact that the owners and investors are swimming in cash, because they can “employ” freelance entrepreneurs (that is the myth they use) who are so desperate to work that they are willing to do a job that hardly produces a living wage let alone a job with prospects.

In all fairness there are delivery men and women who claim that they are happy with this type of work, but the bulk of these workers can be categorised as cheap non-unionised workers. The employers also know that the main political parties, the unions and the population at large will not object to this business especially when Wolt is a recipient of more than €400 million. 

But let’s put this business in the right perspective. Wolt is not innovative, nor is it in any sense original. The same delivery service has been around for decades in India. Every day trains and hand-drawn carts deliver millions Tiffin lunches in large circular metal tins called dabbas. The meals are often made by the man’s wife at home to avoid more expensive and possibly dirty restaurants. Each dabba comes tiers with rice, a curry, vegetables, dal, flat bread and a sweet dessert.

Secondly taxis around the globe have been running such GPS location systems for years. There is nothing special or innovative about Wolt’s delivery application or payment system.

Thirdly, it operates like Uber, now closed down in Finland (!) , and depends on a willing low-cost delivery platform which minimises social insurance and pension benefits for the benefit of investors. The argument that restaurants benefit for delivery services during Covid is acceptable but that is not a strong argument for supporting this service.

Your correspondent feels a sense of shame when sitting in a restaurant, and seeing the delivery guy arriving on his bike in the snow to pick up one more meal for delivery. It is a struggle to understand how a country like Finland, that is determined to educate its population to face the global challenges, can feel pride in such a predatory system. It is understandable that many jobs will always be hard and unpleasant, but…

Photo: Wikipedia – The Bombay Dabawalla – Joe Zachs from Pune, India. A charitable Trust started in 1890, called the Nutan Mumbai Tiffin Box Supplier’s Association or more commonly known as The Bombay Dabawalla has achieved 6 Sigma. They collect the Lunch Tiffin from home and deliver at the work place in a record time. Approximately 4,00,000 transactions are done per day with a work force of approximately 5000 employees.. The Error rate is 1 in 16 million transactions. (6 Sigma performance requires 99.999999 % efficiency) The charge Rs 300 each per month ($6 per month) This rate is standard for any distance or weight. Their latest marketing strategy is Marketing pamphlets in the “Dabba”

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