The week has seen two big firms announcing layoffs. After OYO announced it is firing thousands across India and China, loss-laden Walmart India is also in the process of sacking about a third of its top executives based at local headquarters in Gurgram, as per an ET report.
As per the report, Walmart has announced the layoffs of more than 100 senior executives including vice presidents across sourcing, agri-business and the fast-moving consumer goods (FMCG) divisions. The world’s largest retailer also plans to shut the Mumbai fulfilment centre, its largest warehouse, and halt new-store expansion in India.
A Walmart India spokesperson, without commenting on the number of people being laid off said, “We are always looking for ways to operate more effectively to serve our members. This requires us to review our corporate structure to ensure that we are organized in the right way to best meet the needs of our members. Impacted associates have been offered enhanced severance benefits and outplacement services to support their transition.”
As per reports, more layoffs are in the offing with more people expected to leave later in the year.
The layoffs come as profit is still not within Walmart’s reach in India on account of a sluggish sales growth more than a decade after entering the country. Walmart India’s Best Price stores had incurred losses of Rs 2,180.8 Cr until March 2019. In the last fiscal year, Walmart India posted sales of Rs 4,095 crore with a net loss of Rs 171.6 crore. The retailer had also recently promoted Sameer Aggarwal to the position of Deputy Chief Executive Officer. This happens to be his second promotion in his almost two-year stint at the company.
Update: In response to the story, Walmart issued a statement from Krish Iyer, President & CEO, Walmart India, "Walmart remains committed to growing its B2B Cash & Carry business in India. We opened 6 new Best Price modern wholesale stores, 1 Fulfilment Center and our sales grew 22% in 2019. We have recently made significant investments to serve our members better and will continue to do so. This includes investments in our brick and mortar stores as well as e-commerce. Our members are increasingly becoming omnichannel shoppers. We are thus investing heavily in technology and have a healthy pipeline of Best Price stores. This will provide our members with a true omni-channel and convenient shopping experience in the future."
He further added that the retailer is looking for ways to operate more efficiently, which requires it to review its corporate structure to ensure that it is organized in the right way.
"As part of this review, we have let go 56 of our associates across levels at the corporate office. All of the 56 impacted associates (8 in the senior management and 48 in the middle/ lower management) have been offered enhanced severance benefits and outplacement services to support their transition," he added.
Krish further added that the speculation about the second round of layoffs in April is not correct.