Over 300 employees would be affected by the layoffs, which are a part of a reorganisation that founder and CEO Kabeer Biswas revealed in a town hall on Wednesday, according to a story in the newspaper that cited various sources with knowledge of the situation.
Dunzo has announced a 30% reduction in its personnel, which would result in around 300 layoffs. According to media sources, the supermarket delivery network has also raised $75 million in investment, with Google and Reliance Industries reportedly among the backers. Livemint was unable to independently confirm the development.
During a town hall meeting on April 5, Dunzo informed its employees of the job losses and stated that it was aiming to change its business plan to achieve profitability before the IPO. The action is intended to assist Dunzo in turning a profit prior to its anticipated initial public offering (IPO) in 2025.
The most recent information comes as Dunzo deals with more fierce competition in India’s extremely competitive e-commerce business. Although the epidemic has raised demand for online delivery services, it has also brought about difficulties, including disruptions in the supply chain and higher expenses.
With services ranging from grocery delivery to pet supplies, Dunzo, which was formed in 2015, has experienced recent years of fast growth. Additionally, the company has been looking into other markets, such as bike taxi services, and has funded more than $200 million so far.
Approximately 60–80 individuals, or close to 3% of Dunzo’s employment, were let go in January. The layoffs happened a few months after Dunzo closed a few of its dark storefronts in an effort to save costs.
Kabeer Biswas CEO, and co-founder of Dunzo, said in a statement at the time that the company was continuously working on redefining business procedures at scale and that firing individuals was always a painful choice. He continued, The best assistance possible was being given to the impacted staff during their move.
Due to macroeconomic headwinds and a fundraising winter, many Indian firms, including Dunzo, have had to reduce costs by firing employees.
Since quite some time, the job market in India has been difficult, and the COVID-19 pandemic has only made matters worse. Many of the nation’s entrepreneurs have had trouble raising money, and some have had to change their business strategies in order to survive.
According to the article, Biswas informed the crowd at the town hall that the company must make this decision in order to reach profitability over the next 18 months.
Players have stepped up their efforts to ensure users receive their orders in 15 minutes or less in response to the increased demand for home goods to be delivered super-quickly.
According to ET, which cited sources in the know, the delivery company is still in discussions with additional investors, including the Abu Dhabi Investment Authority (ADIA), but that funding might not materialise until the company has stabilised and specific criteria have been satisfied.
