KARACHI: Alibaba-owned e-commerce platform Daraz Group has announced layoffs across the group to "adopt a more streamlined and agile structure", acting Chief Executive Officer James Dong said on Tuesday in an internal memo to employees reviewed by Reuters.
The memo did not mention the number of people affected by the layoff. Daraz declined to comment on the percentage or absolute number of employees impacted across its operations in Pakistan, Bangladesh, Nepal, Sri Lanka and Myanmar.
The company’s acting chief executive officer, James Dong, issued an internal memo on Tuesday, telling the employees the downsizing decision “was taken as a last resort.”
“Over the past couple of years, we have worked to manage costs and improve operational efficiency substantially,” he said. “Despite our efforts to explore different solutions, our cost structure continues to fall short of our financial targets. Facing unprecedented challenges in the market, we must take swift action to ensure our company’s long-term sustainability and continued growth.”
"Reluctantly, we will bid farewell to many valued members of the Daraz family." Dong announced the company planned to proactively improve the consumer experience by diversifying its offerings of value-for-money products and expanding its product categories. “We remain passionate and ambitious about South Asia, and are committed to maintaining our regional presence in order to continue contributing to its digital transformation,” he added.
Last year, Daraz told Reuters it employed 3,000 employees across its geographies, prior to the e-commerce marketplace cutting its workforce by 11 percent due to difficult market conditions, the Ukraine crisis, supply chain disruptions, soaring inflation, higher taxes and fewer government subsidies, among other reasons.
"Despite our efforts to explore different solutions, our cost structure continues to fall short of our financial targets. Facing unprecedented challenges in the market, we must take swift action to ensure our company's long-term sustainability and continued growth," Dong was quoted as saying.
He added that the group plans to focus on proactively improving consumer experience by diversifying offerings of value-for-money products, expanding product categories and enhancing operational efficiency of sellers on its platform.
In January, the e-commerce group appointed James Dong as acting CEO, replacing outgoing CEO Bjarke Mikkelsen. Pakistan and Bangladesh are the group's biggest markets, outgoing CEO Mikkelsen said last year.
Daraz was founded in 2012 in Pakistan as an online fashion retailer before becoming a leading e-commerce platform in South Asia. It provided end-to-end solutions and emerged as the top online shopping app in Pakistan before its acquisition by Chinese Internet giant Alibaba in 2018. The business covers four key areas – e-commerce, logistics, payment infrastructure and financial services. It has more than 30 million shoppers, 200,000 active sellers and over 100,000 brands, the company told Reuters.
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