The ongoing coronavirus pandemic has forced businesses to get on their knees. The nationwide lockdown has started taking toll on businesses and food delivery companies are having a really tough time due to fear of catching the virus in consumer’s mind.
Owing to the troubles because of the pandemic, food unicorn Swiggy is recently planning to downsize operations of its cloud kitchen business.
According to sources aware of the matter, the company decision could impact about 900 employees. However, the company has not yet commented on the exact number of employees likely to be impacted.
In a company statement, a Swiggy spokesperson said, “As COVID-19 disrupts daily life across the country, the hospitality industry has come under severe pressure. As the lockdown gets further extended, we are evaluating various means to stay nimble and focused on growth and profitability across our private brand kitchens.”
These include renegotiating contracts with landlords, relocation of certain kitchens to more optimal locations and discontinuing operations at a few kitchens that have been severely impacted since the lockdown came into effect, it added.
“This will, unfortunately, have an impact on a certain number of kitchen staff who will be fully supported during this transition,” the statement said.
Although the company is not considering any pay cuts, it has told employees there won’t be any appraisals this year.
Swiggy is currently not operating its food delivery business in around 300-odd Tier 3 and Tier 4 cities due to various challenges. However, it is looking to capitalize on this loss through delivery of groceries and essential services.
With this move, Swiggy becomes the second unicorn in the consumer internet space to opt for mass layoffs.
Recently, payments unicorn Paytm also decided to lay off about 700 employees after a performance review.
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