Daraz to reduce employees by 11%

The company has to refocus its business following the challenges in the past 12 months.

E-commerce platform Daraz will be retrenching 11% of its employees due to improve profitability and growth outlook following the challenges in the market environment.

In a message to the employees, Daraz CEO Bjarke Mikkelsen said the last 12 months had been “extremely difficult” due to the war in Europe, supply chain disruptions, rising inflation and taxes, and the removal of essential government subsidies.

“Despite these headwinds, we are still growing our business and we have made big progress on our unit economics in the last 12 months. Essentially, we are improving our services faster than that market can hold us back, and this makes me incredibly proud,” Mikkelsen said.

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“Unfortunately, it’s not enough and we need to do more to adjust the company to the lower growth outlook in the next couple of years. In order to weather the storm, we need to collectively do everything we can to improve profitability and save costs. This includes refocusing on the core business, simplifying the organisation and doing more with less in all departments,” he added.

Mikkelsen said the company has to stop investments that are not aligned with the company’s strategies and needs to ramp up product innovation across its platforms and its internal productivity.

He added that they will prioritise providing support to those affected by the organisational changes.