Indian food delivery startup Zomato cuts 13% of the workforce
Zomato, an Indian-based food delivery startup is cutting 13% of its workforce as it seeks to reduce the costs and tide of the coronavirus crisis which has made it very cautious when ordering food online.
The 11-year-old firm didn’t reveal the exact number of people he was letting go of, but the number is over 500. A spokesperson for Zomato told ProWellTech that the startup employs around 4,000 people and the layoff has an impact on its workforce globally.
Zomato, which laid off some 540 employees from its customer team in September last year, said it would provide affected people with half their wages for six months or until they found work elsewhere, depending on which event check first.
Deepinder Goyal, co-founder and CEO of the Gurgaon-based company, said Zomato was “seriously affected by the COVID blockades”. India issued a nationwide blockade in late March, which is still ongoing, to prevent the outbreak of the infectious disease.
“A large number of restaurants have already closed definitively and we know that this is only the tip of the iceberg. I expect the number of restaurants to drop by 25-40% in the next 6-12 months. What really happens, for better or for worse, is anyone’s guess, “he wrote in a blog post.
Goyal also proposed a wage cut across the company. “Starting in June, I am proposing a temporary reduction in remuneration for the whole organization. Lower cuts have been proposed for people with lower wages and higher cuts (up to 50%) for people with higher wages, “he added, adding that several people have already volunteered to give up their full salary. for six months.
Today’s announcement follows a similar move by Swiggy, The largest Indian food delivery startup, which cut about 1,000 jobs last month. Both startups are currently processing less than one million orders on their platforms, compared to nearly 3 million they were handling before the outbreak.
To compensate for the loss, both also expanded their businesses. Zomato, which recently started delivering food, said it is now serving this category in 185 cities in India and plans to launch this offering in the United Arab Emirates and Lebanon.
Zomato, which raised $ 150 million from Ant Financial in January, was in talks to raise another $ 350 million. In a previous email exchange with ProWellTech, Goyal said he expected the round to close by mid-May.