Alibaba-owned e-commerce platform Daraz Group has announced layoffs across its operations, aiming to adopt a more streamlined and agile structure, according to an internal memo reviewed by Reuters. The memo, issued by acting Chief Executive Officer James Dong, did not specify the number of employees affected by the layoff. Daraz declined to disclose the percentage or absolute number of impacted employees across its operations in Pakistan, Bangladesh, Nepal, Sri Lanka, and Myanmar.
The memo conveyed the difficult decision to bid farewell to many valued members of the Daraz family. Last year, Daraz informed Reuters that it employed around 3,000 individuals across its geographies. However, the e-commerce marketplace recently reduced its workforce by 11% due to various challenges, including difficult market conditions, the Ukraine crisis, supply chain disruptions, soaring inflation, higher taxes, and reduced government subsidies. Despite efforts to explore different solutions, Daraz’s cost structure continues to fall short of its financial targets. Dong emphasized the need for swift action to ensure the company’s long-term sustainability and continued growth in the face of unprecedented market challenges.
The group, under its new leadership, aims to enhance the consumer experience by diversifying its offerings with value-for-money products, expanding product categories, and improving the operational efficiency of sellers on its platform. James Dong was appointed as the acting CEO in January, succeeding outgoing CEO Bjarke Mikkelsen. Pakistan and Bangladesh represent Daraz Group’s largest markets, according to Mikkelsen’s statements last year. Established in 2012 as an online fashion retailer in Pakistan, Daraz was acquired by Chinese internet giant Alibaba in 2018. The company operates in four key areas: e-commerce, logistics, payment infrastructure, and financial services. Daraz boasts more than 30 million shoppers, 200,000 active sellers, and over 100,000 brands, according to information provided to Reuters.