Dunzo Layoffs: Reliance Retail-Backed Online Delivery Firm Lays Off 150 Employees, Assures To Pay Severance After It Secures Funding
Reliance Retail-backed Dunzo laid off 150 employees amid cash crunch. The company said it would pay the severance, leave encashment, pending salaries and other dues once it gets necessary funds.
Bengaluru, September 1: Dunzo, a Reliance Retail-backed online delivery firm, has laid off 150 people in its new round of layoffs. The Dunzo layoffs reduced the total workforce to 50 amid financial struggles. The Bengaluru-based delivery company sent emails to its employees on Friday and assured them that it would pay them their pending salaries, severance, leave encashment, and any other remaining dues as soon as it secures the required funds.
According to a report by Financial Express, Dunzo had been facing a cash crunch and urgently required funds to sustain its operations. Therefore, it laid off 150 employees. Dunzo layoffs were reportedly announced as part of the company's broader efforts to control its costs. With this move, the online delivery platform would likely generate cash flow and address the liabilities. Layoffs Not Coming Due to GenAI: Indian Tech Giants Including Infosys, Wipro, HCLTech Focused on Upskilling Employees Than Laying Them Off.
Once Dunzo secures the funding, it said it would use it to pay the overdue salaries of the working and former employees and outstanding payments to its vendors. The report revealed that the company told its workers that it was about to close a transaction and was at the "final stage." If this had been done, the company would have settled the dues within 10 to 15 days, said the report.
Following this, the Dunzo payroll team notified the employees about unexpected struggles to secure the needed funds and requested them not to pursue any legal action. The company also warned the employees that the ongoing process (of obtaining funds) could be delayed even more if they go for any legal action. Qoo10 Layoffs: Singapore’s E-Commerce Company Lays Off Nearly 80% of Staff Amid Challenging Market Condition and Restructuring.
Dunzo laid off several employees in 2023 and had gone through several rounds to secure funding. The report highlighted that it was once valued at USD 775 million but faced struggles to secure the necessary funds. Despite Reliance Retail holding a 25.8% stake in the company, the online delivery firm faced trouble achieving profitability.
(The above story first appeared on LatestLY on Sep 01, 2024 06:10 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).