- Daraz laid off up to 800 employees to cut costs.
- The job cuts impacted around a quarter of Daraz’s global workforce.
- It’s the second round of layoffs as Daraz struggles towards profitability.
Daraz Group, the Pakistan-founded e-commerce platform acquired by Alibaba in 2018, laid off up to 800 employees this week across its operations in a bid to cut costs.
An internal memo by acting Daraz CEO James Dong stated the company’s “cost structure continues to fall short of our financial targets”, necessitating swift action to ensure long-term sustainability. The job cuts are estimated to impact around a quarter of Daraz’s global workforce.
Layoffs across South Asia
The deepest layoffs occurred in Pakistan, Daraz’s biggest market, where sources say between 250-400 staff lost their jobs. The company also reduced its headcount amid civil conflict.
The restructuring comes a month after founder Bjarke Mikkelsen departed as CEO. He said Dong would focus on integrating Daraz with other Alibaba e-commerce brands.
Not Daraz’s first round of job cuts
This is not the first time Daraz has slashed staff to cut losses. Last year, around 300 employees were laid off in an 11% reduction.
Despite short-term cost-cutting, Daraz maintains ambitious growth plans in South Asia backed by Alibaba. But the latest layoffs show the company still faces financial struggles on the path to profitability.
Founded as an online fashion retailer in Pakistan in 2012, Daraz was acquired by Alibaba in 2018. It now aims to serve 500 million online shoppers in South Asia within 5 years.
Daraz appears focused on boosting efficiency to achieve market dominance.
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