Restaurants around the nation will also be left scrambling to adjust after Menulog revealed it would stop trading in Australia on November 26, a business expert has warned.
For almost 20 years the food delivery service was promoted by its "Did Somebody Say" ad campaigns featuring the likes of Snoop Dogg, Katy Perry, Christina Aguilera and Australian hip hop trio Bliss n Eso.
However despite the star power, the company has lost its battle for market share against UberEats and DoorDash.
"We know that Menulog has had to spend heavily in order to get traction, but maintaining traction is very, very difficult," Griffith University business school academic Graham Hughes told AAP.
"So they invested into large campaigns with Snoop Dogg and the like, and they cost a lot of money."
Menulog's parent company, Dutch firm Just Eat Takeaway.com, had been losing ground to the two competing behemoths despite underlying growth in the food delivery sector, he said.
"I feel they've done their sums and thought 'well, this is going to be an elongated battle with two huge players with very, very deep pockets'," Adjunct Associate Professor Hughes said.
Menulog's announcement, which follows the closure of Deliveroo in 2022 and Foodora in 2018, is set to cost 120 jobs - and hit hungry Australians in the hip pockets.
Menulog's departure had left Australia with a food delivery duopoly, a model in which "prices tend to rise over time", Assoc Prof Hughes said.
Restaurants, which already operated on small margins, would also be left with fewer options, giving UberEats and DoorDash more power to dictate terms, he said.
"I would imagine that this decision puts a fair bit more pressure on them (restaurants) and I can only presume more pressure on pricing as well."
Menulog, which was founded in Sydney in 2006, was one of Australia's most popular food delivery apps according to Roy Morgan, second only to UberEats in 2022.
The decision to close had been challenging, Menulog managing director Morten Belling said, with the two-week notice designed to allow customers to redeem vouchers and credits.
"Our priority now is to support our customers, couriers and partners," he said.
The company will offer some of its delivery couriers four-week redundancy payouts.
The news would come as a shock to thousands of couriers, Transport Workers' Union national secretary Michael Kaine said.
"In the gig economy, workers are still languishing with below-minimum wage rates, no sick leave or superannuation and deadly pressure to rush to make a living and avoid being deactivated," he said.
The federal government introduced Closing Loopholes laws in 2024 that introduced minimum standards for employee-like workers, and allowed the Fair Work Commission to set minimum standards for gig economy workers.
Remaining delivery services should back the changes urgently, Mr Kaine said, to ensure couriers have confidence in their employment conditions.
"DoorDash, Uber Eats, Hungry Panda and Easi now need to come to the table to ensure we get standards in place as soon as possible," he said.
The closures come despite growth in the market, with Statista reporting more than 8.3 million Australians used food-delivery services in 2024 and predictions from Mordor Intelligence that the food service market would grow by 11.45 per cent annually.
11°C