Meesho, a popular E-commerce platform has kicked out 150 employees from its grocery business, which is now seen as Meesho Superstore. The company was recently reconstructed and rebranded as Meesho Superstore from Farmiso earlier as trying to avoid redundancy and pushing it as a main Meesho platform.
Meesho said last week that it would integrate the grocery vertical into its main application. The company aims to provide its users with a new and different experience that somewhere the company was lacking to present.
"Approximately 150 full-time employees will be impacted by the reorganization of Meesho Superstore, which is focused on bringing in efficiencies," a Meesho representative told ET. The corporation is providing severance compensation and outplacement support to employees affected to help them find new jobs outside of the company."
According to sources close to the situation, the company's reduction would affect around 400 employees. Meesho, on the other hand, rejected this, claiming that just 150 of its employees were ordered to leave.
"The layoffs have no effect on roles at the core Meesho Marketplace Company, where we continue to acquire and expand people," Meesho stated in a blog post on Monday.
On April 6, the firm said that its grocery service, which is presently accessible in six locations, will be expanded to 12 cities by the end of the year.
According to a Meesho source, Superstore has the most employees in the organization, with around 500 people. City-level managers, product, design, and executives who worked on its user experience have all been impacted.
On the requested anonymity, an employee who was forced to leave told ET that the company indicated it was turning its grocery business and would shift to a different model that would not rely on city-level executives. According to the individual, none of the employees were given prior notice of their terminations.
According to insiders, the layoffs are an attempt to limit the company's financial burn.
In September, Since Independence Media researched that Meesho was losing $20-25 million per month due to severe competition in the online retail business. According to sources in the know, the cash burn increased to as much as $50 million per month earlier this year.
Superstore launched as a test in Karnataka last year, with a concentration on reduced pricing rather than the convenience of speedier delivery, which rapid commerce providers like Swiggy's Instamart, Zepto, and others have been concentrating on.
Meesho competes with companies such as Dealshare, Citymall, and Flipkart's Shopsy, which target customers through community purchasing strategies.
After raising $570 million in September, headed by Fidelity, the business has been in negotiations to raise further financing.
It has been in the market to raise additional financing, backed by SoftBank Vision Fund and Proses (formerly Naspers), among others, but insiders say it has yet to conclude the fundraising.
Meesho, like many other well-funded businesses, is aiming to reduce capital burn following a year of eye-popping fundraising and stratospheric valuations snatched by Indian new generation giants.
