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Food delivery company Zomato has started handing in dismissal notices to around 3% of its workforce across various divisions. The development comes on the heels of several homegrown start-ups resorting to layoffs to manage finances.
Gurgaon-based online food aggregator told fortune india Less than 3 percent of the company’s workforce “regularly loses performance.” The food ordering company has 3,800 employees.
This will be the company’s second layoff since 2020. In May 2020, the company laid off 520 employees, or 13% of its workforce.
It also comes days after three executives left the company within a two-week period. On November 18, company co-founder Mohit Gupta resigned. Gupta said in a statement, “Over the past few years, I have seen Deepi (co-founder, managing director and CEO Deepinder Goyal) become more mature and confident, and is now fully capable of leading the business. Towards success. A bright future with you all by his side. It is with this confidence that I have decided to leave Zomato to find other unknown adventures that life has in store for me. Looking ahead, I am very excited about Zomato, Blinkit, Hyperpure and There is excitement about the vision that Feeding India is building.”
On November 14, Rahul Ganjoo, head of new initiatives at the company, resigned. This follows the resignation from Zomato of Siddharth Jhawar, head of the company’s flagship intercity delivery service intercity legends.
Notably, the company also stopped its delivery operations in the UAE from November 24. The company sold its UAE operations to Talabat-Delivery Hero in 2019, but has been providing services to Talabat in exchange for reimbursement of costs. “We would like to update the exchange that the company will stop providing services to talabat in UAE from 24th November 2022 and according to the terms, customers who want to order food through Zomato app in UAE will be redirected to talabat between both parties agreement,” the company said in a statement.
Earlier this month, the company reported a 62.2% year-on-year rise in revenue for the July-September quarter to Rs 16.61 billion compared to Rs 10.24 billion a year earlier. The food tech major’s net loss in the July-September quarter also narrowed by 41.6 per cent to Rs 2.51 crore from Rs 430 crore a year earlier.
Shares of Zomato fell 4.24 percent to Rs 64.30 on Monday. The company became the first entrepreneurial unicorn listed on the stock exchange on July 23, 2021.
Several domestic tech start-ups have laid off staff in the past few months. Last month, edtech unicorn Byju’s decided to lay off as many as 2,500 employees as a cost-cutting measure to become profitable by 2023. In addition to Byju’s, many start-ups such as Unacademy, Vedantu and Cars24 have also laid off employees. Money crunch.
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