E-commerce giant Flipkart is planning to cut jobs as part of its annual performance reviews. The workforce is expected to shrink by 5-7% which can impact over 1,500 employees. This move comes at a time when the company is looking to optimize costs and boost profitability.


Annual Performance Reviews Result in Job Cuts 

Each year, Flipkart evaluates its employees’ performance during the annual appraisal cycle. As part of this, some jobs and roles are identified as redundant or unnecessary. This year, the performance reviews are expected to result in cutting around 5-7% of the total workforce. With over 22,000 employees currently, this would translate to reducing the roles of between 1,100 to 1,500 people. 

Priority is Optimization and Cost Control 

The key reasons for this move are prioritizing optimization of resources and controlling costs. The fluctuating demand environment in the recent past has impacted e-commerce businesses. Flipkart wants to focus on utilizing its resources efficiently across businesses both new and existing. It also aims to reduce expenses in different areas as part of its restructuring plans for 2024.

Not the First Time Job Cuts are Happening

Interestingly, this is not the first time Flipkart has resorted to job cuts after performance reviews. It has been following a similar process for the last two years to realign teams. Additionally, over the past year, fresh hiring was also frozen to keep a check on mounting costs. Several other Indian startups have also optimized their teams in 2022-23 due to economic challenges.

No Changes to Future Plans

Despite the restructuring, Flipkart is still on track with its long term goals. There will be no reconsidering of plans like the postponed initial public offering till 2024. It continues investing in growth areas like travel, hotels and healthcare with its acquisitions. The proceeds of a new $1 billion funding are likely to be utilized for fueling these expansion efforts as well.

Focus on Cost Optimization, Synergies & New Priorities

In conlusion, Flipkart sees cost optimization as a priority, especially with macro headwinds looming. It is also determined to generate effiiciencies by synergizing teams within its parent Walmart‘s fold. Most importantly, the restructuring will align resources as per the company’s evolving priorities into new business lines vital for its future roadmap.

Flipkart aims to emerge stronger from this evaluation by enhancing productivity while still empowering employees through transition support and reskilling opportunities. The goal is ensuring long-term sustainability through both optimal structure and a engaged workforce.