Swiggy may lay off 250 employees in December, more to follow in coming months

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Food and grocery delivery brand Swiggy plans to lay off up to 250 employees this month, the Economic Times reported. This is about 3 to 5 percent of its entire workforce.

Two sources told ET that the layoffs may cross 250 over the next few months while a third person stated that people employed in the supply chain, operations, customer service as well as technology will also be affected.

Swiggy, in response to the daily, said that there haven’t been any layoffs as of now, but did not rule out such a possibility in the near future.

Moneycontrol could not independently verify the news.

“We concluded our performance cycle in October and have announced ratings and promotions at all levels. As with every cycle, we expect exits based on performance,” Swiggy said.

As per a company insider, Girish Menon, Swiggy’s head of human resources, informed the employees regarding their performance based exits. He also said that the company has begun restructuring its teams.

The company is moving its employees from Instamart, which is Swiggy's grocery delivery service, to other functions, they added. This aims to reduce the cash burnout of the organisation on the grocery delivering service.

As mentioned by a brokerage firm, Swiggy suffered losses during January to June which were “much higher at over $315 million” when compared to a $50-milllion loss for its rival brand Zomato, on a standalone basis.

“Major rationalisation exercise is being planned,” said a person who requested anonymity. “They want a very lean team structure across functions. Sensitisation workshops for employees are planned for later this month. They have appointed a consulting firm to advise them on the restructuring… Most of the layoffs are likely to happen in tech, engineering, product roles and operations.”

On November 24, Swiggy’s investor Prosus stated that the brand’s core food delivery business clocked in growth and gross merchandise value (GMV) growth of 38 percent and 40 percent. This took place within the first six months of 2022. The brand’s grocery delivery business Instamart saw order and GMV increase about 20 times and 15 times.