Flipkart to Reduce Workforce by 5-7% Through Performance Evaluations, States Economic Times Report
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In recent news, the renowned e-commerce platform Flipkart is reportedly planning a 5-7% reduction in its workforce, as per information from the Economic Times. This strategic move, slated to conclude by March-April, involves downsizing based on annual performance reviews. The decision aligns with the company’s cost-containment strategy, reflected in its abstention from hiring new employees in the past year.
Flipkart, under Walmart’s ownership, has undertaken similar workforce reduction initiatives over the past two years. Additionally, its subsidiary, Myntra, implemented a cost-cutting exercise last year, leading to the layoff of 50 employees.
Despite unanswered queries directed to Flipkart, the report cites an internal communication from March 2023, where the company announced the exclusion of increments for senior leadership positions, including Grade 10 and above, comprising managers and vice presidents.
Sources indicate ongoing plans to enhance resource efficiency across current and upcoming business ventures. Flipkart’s strategic roadmap for 2024 is expected to be finalized in an upcoming meeting of senior executives next month.
In December 2023, Walmart invested close to $600 million in Flipkart, marking its first direct investment in the company that year. This followed its acquisition of Tiger Global Management’s stake for $1.4 billion in July, raising Walmart’s stake to 80.49%. The $600 million investment is part of a larger $1 billion infusion into the Indian e-commerce major, with other investors, including SoftBank, expected to contribute.
As of July 2023, Tencent holds the second-largest stake in Flipkart at 5.98%, according to market research from Tracxn. The company’s valuation during the July transaction reached nearly $38 billion.
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