Flipkart may see 5% of workforce exit in annual restructuring exercise

Retrenchments to be performance-based, sources tell DH.

Bengaluru: E-commerce giant Flipkart is likely to see a number of voluntary exits and performance-linked layoffs soon, senior sources in the company confirmed to DH. This number could be as much as 5 per cent of the Walmart-backed company’s 22,000 strong workforce, or around 1,000 people.

“There is no layoff in the charter but there are exits that happen every year based on the performance of categories and performance of teams, which happens post appraisal (March-end) ,” said a source aware of the developments. The person added that some are also expected to leave on their own to seek out other opportunities.

In fact, as per two sources, Group Chief Executive Officer Kalyan Krishnamurthy held a town hall meeting with employees and said that no layoffs were being planned.

Additionally, there were reports that quick commerce and food delivery company Swiggy has let go of around 400 employees. The company’s representatives did not respond to calls and messages from DH.

This latest round of expected retrenchment comes after Paytm parent One 97 Communications laid off around 1,000 employees late last year, in a strategic move to lower costs and realign its business operations.

“This is not a knee jerk reaction, possibly a tactical correction these companies are making before the end of the financial year from a cost offloading perspective. Some of these players also have to justify their spends to investors,” MS Prasadh, who heads research at specialist staffing solutions platform Xpheno, explained.

Going forward such layoffs may be seen in a few more customer-focused service players, Prasadh added.

In its first round of a major layoff, Swiggy slashed 380 jobs in January last year and shut down its meat marketplace in order to trim costs. The IPO-bound company, which employs a 5,000-plus workforce, is slated to raise about $1 billion later this year.

Earlier this month, US-based asset management company Invesco raised Swiggy’s valuation a second consecutive time to $8.3 billion, from earlier $7.85 billion in October 2023.

Flipkart on the other hand, saw around 50 employees exit its fashion portal Myntra whilst observing a hiring freeze in 2023.