@Kaustubh Katdare • 14 May, 2013
Flipkart layoffs are in progress and an employee who was laid off recently has said that the company is showing pink-slip to employees almost every month - says ET report. Almost 250 employees have been laid off and majority of them are from the supply chain, logistics and call center teams. The company has said that non-performers, or approximately 10% of the workforce with the lowest ratings have been asked to leave, and it's a general practice. Jabong's co-founder, Praveen Sinha has said that they've laid off about 20 employees so far. Jabong is one of the major competitors of Flipkart and continues to be a strong force in the Indian e-Commerce markets.

It's for the first time that these e-commerce companies are laying off employees at such rate. The industry experts believe that the decision to sack employees is because of the troubled e-commerce markets and narrowing profit margins. All the major ecommerce players are now shifting their attention from acquiring new customers to achieving positive economics per transaction. Pearl Uppal, who once headed FashionAndYou said that 70% of the revenue is used to acquire new customers. Now the period of land-grabbing is over and investors are pressuring founding teams to focus on efficiency of operations and generating more revenues. Flipkart recently initiated 'marketplace' model - which requires fewer employees to operate.

The company's rapidly taking measures to control revenues - and even increased the minimum order price from Rs. 100 to Rs. 500 for free shipments. I hope companies like Flipkart will survive the troubled times. If Flipkart fails, it'd be a big blow to the entrepreneurial dreams that have spurred up in India, watching Flipkart grow from dorm to big corporate that dominates the Indian e-Commerce scene.

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