E-commerce firm Flipkart is implementing performance-based job cuts, which will reduce the team size by 5-7%, The Times of India reported. The cuts will be based on an annual performance review and will be completed by March-April.
A major player in the Indian e-commerce space, the Walmart-owned company is preparing to undergo a restructuring phase to optimize its resources and operations. The company, excluding fashion portal Myntra, currently employs 22,000 people.
This is not the first time Flipkart has made performance-based job cuts. The report added that similar exercises have been in practice over the last two years.
Additionally, as part of cost-control measures, Flipkart has refrained from fresh hiring in the past year. The company is finalizing a $1 billion financing round, including contributions from Walmart and other investors.
Sources told the paper that Flipkart is gearing up to enhance the utilisation of its resources across existing and new business ventures. Discussions and decisions regarding the restructuring plans and the 2024 roadmap are slated for a meeting involving senior executives in the coming month.
Sources said that despite the ongoing restructuring process, Flipkart has maintained its decision to postpone the IPO until 2024. Previous IPO plans for 2022-2023 have been temporarily stopped.
Flipkart’s strategic projects, including the recent acquisition of Cleartrip, partly owned by Adani Group, have achieved a gross merchandise value (GMV) of approximately $1.5 billion to $1.7 billion. The company is considering further investment in its hotel business, expanding Cleartrip’s services beyond airline ticket booking.
Sources close to the company said Flipkart has been working hard on internal coordination for several months. The restructuring is part of the company’s goal to reassess its current and future business trajectory. They added that while securing $600 million in fresh capital from parent company Walmart as part of the ongoing $1 billion funding round, Flipkart’s senior management is actively looking to reduce costs at all levels. different item.
Streamline the entire industry team
Many of India’s major internet companies, boosted by strong demand for technology services during the pandemic-induced outbreak in 2021, are now streamlining their teams. Industry experts predict similar moves by other Indian-backed organisations throughout 2024.
Insiders told the newspaper that Flipkart’s restructuring phase reflects the ups and downs of the e-commerce sector in 2023, leading to necessary adjustments. The annual appraisal cycle at Flipkart drives these team restructuring efforts, aimed at optimising operations and resources. The industry-wide adjustments are a response to the changing dynamics in the e-commerce sector.
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