Job loss: Zomato lays off 541, says tech advances led to redundancies

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Updated: September 8, 2019 6:10:52 AM

Zomato on Saturday said it let go of 541 employees across customer, merchant and delivery partner support teams, saying “growing business and improvement in services cut down on the need to service order-related queries”.

The 541 people form about 10% of Zomato’s employee strength across the support teams, the company saidThe 541 people form about 10% of Zomato’s employee strength across the support teams, the company said

Zomato on Saturday said it let go of 541 employees across customer, merchant and delivery partner support teams, saying “growing business and improvement in services cut down on the need to service order-related queries”.

In a statement, the Gurgaon-based food delivery firm said currently, a mere 7.5% of its orders (food) require support, a significant decline from about 15% in March.

The 541 people form about 10% of Zomato’s employee strength across the support teams, the company said, with a spokesperson adding that “we have dramatically improved the speed of service resolution”.

Zomato said it is helping place the employees with companies that provide similar services. It has also extended between two and four months’ severance pay based on tenure and family health insurance cover till the end of January 2020.

“There is no one intervention or optimisation that has led us here, but a series of technological and process advances that on one end spurred the growth of our food delivery business and subsequently the five times growth of our delivery partner fleet over the last year has also led to fewer support queries and certain redundancies within our support functions,” the company said.

Earlier this week, founder and CEO Deepinder Goyal in a tweet said the firm’s delivery partners’ monthly income had crossed Rs 200 crore for the first time. The company’s tally of delivery partners stood at 2,30,000 (including part-time workers) as on September against 74,000 delivery jobs created in the year-ago period.

In September alone, Zomato aims to add 10,000 new jobs as a “result of direct employment and contracts with Zomato”, Goyal said.

In a blog published earlier this year, Zomato said revenues from food delivery jumped to $155 million in the year to March 2019 from revenues of $38 million posted in FY18. Delivery currently contributes about 75% to the firm’s revenues, up from 55% in FY18.

This year the firm has hired about 1,200 people across functions (not inclusive of last-mile delivery fleet) and another about 400 off-rolls positions. “We are currently hiring in our technology, product and data sciences teams,” the company spokesperson said.

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