Flipkart Plans Up to 7% Workforce Reduction in Annual Refocus

E-commerce leader Flipkart is considering a workforce reduction of approximately 5-7% as part of performance-based evaluations and internal restructuring, as reported by The Times of India. These layoffs are anticipated to occur during the annual appraisal cycle in March-April 2024.

Flipkart is set to undergo a significant restructuring to optimize resources and sustain profitability. With the exception of its fashion website Myntra, Flipkart currently employs over 22,000 individuals.

This implies that as many as 1,500 positions at Flipkart could be eliminated during upcoming layoffs in next few months. The company, owned by Walmart, has reportedly been following similar practice during the past two appraisal cycles, according to TOI.

In effort to manage costs and sustain profits, Flipkart has halted new hiring within the company over the past year. According to the report, the company is currently finalizing a $1 billion financing round from Walmart and other investors.

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Sources indicate that Flipkart is strategizing to optimize resources across both existing and new business ventures. Consequently, a meeting of senior executives is scheduled for next month to deliberate on the restructuring plan for 2024. With the likelihood of making a final decision on the layoffs.

Despite implementing restructuring initiatives to navigate challenges, the company, owned by Walmart. Reportedly has no intentions of reconsidering its decision to proceed with the planned initial public offering (IPO) in 2024, as per sources cited by TOI.

Initially, Flipkart had contemplated initiating its IPO in 2022-2023. However, the company had to defer those plans due to its financial circumstances. Nevertheless, Flipkart is now eyeing business expansion in various sectors, particularly in hospitality and hotels, following its acquisition of Cleartrip.

Major IT corporations and startups in India are implementing workforce reductions across various departments to navigate the prevailing global economic downturn. Paytm recently laid off 1000 employees, and both Amazon and Meesho, backed by SoftBank, are undergoing job cuts and restructuring within their respective departments.