Tech giant aims to maximise efficiency amidst industry-wide adjustments
In a strategic move aimed at optimising internal operations, leading e-commerce giant Flipkart has reportedly initiated performance-based layoffs, reducing its workforce by 5-7 per cent. This decision aligns with the company’s commitment to streamlining resources and ensuring maximum efficiency across its current and upcoming ventures.
Job Cuts Amid Industry Trends:
The wave of layoffs, which saw a slowdown in 2023, is making a vigorous comeback in 2024. Following hints from companies like Google about significant layoffs, Flipkart has joined the trend by implementing performance-based job cuts based on annual performance reviews. According to sources, this reduction in team size is expected to be completed between March and April, According to Mint.
IPO Postponed, Strategic Acquisitions Continue:
Despite the ongoing restructuring, Flipkart has decided to postpone its initial public offering (IPO) until 2024, putting a temporary halt to previous plans slated for 2022-23. The company’s recent acquisition of Cleartrip, partially owned by the Adani Group, has generated a gross merchandise value (GMV) of around $1.5-1.7 billion. Flipkart aims to further invest in its hotel business and expand Cleartrip’s services beyond airline bookings.
Efforts in Streamlining Operations:
Flipkart has actively undertaken efforts to streamline internal operations for several months, with the restructuring phase aligning with the company’s goal of reassessing its current and future business trajectories. The decision to defer the IPO reflects the company’s dedication to achieving operational excellence.
Industry-wide Adjustments and Future Outlook:
Flipkart’s restructuring mirrors the highs and lows of the e-commerce industry in 2023, prompting necessary corrections. Industry experts anticipate similar actions from other venture-funded Indian organisations throughout 2024, as major internet companies rationalise their teams in response to changing dynamics in the e-commerce sector.
Amidst the restructuring phase, Flipkart secured $600 million in fresh capital from parent company Walmart as part of an ongoing $1 billion round as per reports. The senior management is actively seeking ways to curtail expenses in various categories while navigating the evolving landscape of the e-commerce industry.
