Chinese ecommerce giant Alibaba-backed Daraz cuts workforce by 11pc

Alibaba Group subsidiary, Daraz Group, an e-commerce platform, is reducing its workforce by 11 per cent to prepare for the ‘current market reality’, the group’s CEO Bjarke Mikkelsen said in a letter to employees shared on the company website.

Mikkelsen cited a difficult market environment, with a war in Europe, huge supply chain disruptions, soaring inflation, increasing taxes, and removal of essential government subsidies in its markets. The group operates in Pakistan, Bangladesh, Sri Lanka and Nepal.

Daraz, Pakistan’s largest e-commerce retail platform, was founded in 2012 in Pakistan and acquired by Chinese giant Alibaba in 2018. It has 100,000 SMEs in Pakistan on its platform.

Ehsan Saya, managing director of Daraz Pakistan, told Reuters that Pakistan is its biggest market and said that Pakistan has the most number of employees employed across Daraz markets.

He adds, “almost one-third of the staff in Pakistan is from regional teams which work with teams in Bangladesh, Nepal, Sri Lanka, Myanmar, Singapore, and China.”

Saya confirmed to Reuters that the 11pc employee cut across the group will also mean an 11pc cut in Pakistan.

The group did not immediately respond to a Reuters request to comment on the number of employees to be impacted by the move and details on restructuring.

In the letter, Mikkelsen said Daraz had been able to increase their active shoppers from three million in 2018 to more than 15m at present, adding that this was done with “an average order growth of almost 100pc until last year”.

Daraz said in 2021 it had access to 500m customers, with a team of 10,000 employees. It has invested $100m in Pakistan and Bangladesh over the last two years.