Online food ordering service Foodpanda’s India unit will dismiss about 300 people. With this, the Rocket Internet-backed firm has joined rivals Zomato and TinyOwl in scaling down business. Swiggy, on the other hand, is expanding its operations.
The layoffs at Foodpanda, confirmed by chief executive Saurabh Kochhar, will see the company lose close to 15 per cent of staff from across business segments. The layoffs will be restricted to the Indian business.
“While we continued to invest in processes and technology, we also had to take some difficult decisions but believe them to be necessary on our path to become sustainable and profitable within the targeted timeline,” Kochhar said.
The company claims the layoffs were triggered due to “a 98 per cent automation rate in order processing”.
This means, it needs fewer staffers to handle the same amount of orders.
The biggest chunk of layoffs, 250 employees, came from shutting down of an in-house call centre.
Foodpanda has become the latest in a wave of downsizing that has hit the Indian online food ordering and delivery companies.
Citing high expenditure, investors have cracked down on companies spending huge amounts on marketing, offering cash discounts and hoarding top-rated talent.
In September, TinyOwl had laid off nearly 100 employees from its Mumbai and Pune offices.
In October, Zomato had let go of close to 300 employees, followed by chief executive officer Deepinder Goyal, sending out an e-mail to employees complaining of low sales effectiveness and that the company would miss its annual revenue targets.