Daraz to lay off 500 employees this week: Sources

Daraz Bangladesh will lay off more than 500 employees this week, company sources said on Tuesday (27 February).

Although the e-commerce platform declined to officially comment and disclose the number of employees being laid off at a town hall meeting yesterday afternoon, they released a statement on their website.

"After much deliberation, we collectively arrived at the decision to adopt a more streamlined and agile structure. Reluctantly, we will bid farewell to many valued members of the Daraz family," said James Dong, its acting CEO, in the statement.

Sources said at least a 35% headcount reduction will occur by this week, and three chief experience officers (CXOs) are set to be laid off.

"Ultimately, more than 500 people would lose their jobs at Daraz Bangladesh," said two senior officials, seeking anonymity.

The e-commerce market leader has around 1,700 employees, including around 950 permanent ones.

In its statement, Daraz Bangladesh said, "This decision was taken as a last resort. Over the past couple of years, we have worked to manage costs and improve operational efficiency substantially. Despite our efforts to explore different solutions, our cost structure continues to fall short of our financial targets."

Daraz mentioned "facing unprecedented challenges" in the market as the reason behind such a decision.

"We must take swift action to ensure our company's long-term sustainability and continued growth," Daraz said.

Addressing those who will be laid off, it said, "Your dedication and expertise have been instrumental in shaping Daraz into what it is today. Daraz could not have done it without you.

"Together, we have made a lasting impact on millions of consumers and hundreds of thousands of sellers through digitalisation. We will do all we can to support you through a severance scheme, career support and overall wellness."

Daraz said its focus is on proactively improving the consumer experience by diversifying its offerings of value-for-money products and expanding product categories.

"In tandem, we will work to enhance the operational efficiency of sellers on our platform. We will also strive to cultivate an efficient, nimble, and resilient organisation, instilled with fighting spirit and the capability to achieve victories essential for maintaining our market leadership in all five markets," reads the statement.

Daraz said it remains passionate and ambitious about South Asia and is committed to maintaining its regional presence in order to continue contributing to its digital transformation.

"Our overarching goal is to enable businesses and consumers across South Asia to reap the benefits of e-commerce," reads the statement.

"We are sad to say goodbye to the talented Darazians leaving us. At the same time, we have full confidence in our team's ability to continue to uplift communities through the transformative power of commerce," it added