Reliance, Google argued Dunzo delays pay by 50% this month, employee says, restructuring rumors

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According to sources, Dunzo, a hyperlocal rapid trading company backed by Reliance Retail and Google, has deferred 50% of salaries for employees in management-level positions and above.

All employees at management level and above received only 50% of their June salary. The rest company says they will pay it later,” the source told Business Today.

Another employee confirmed, we were informed that we would receive the rest of the salary between July 15th and 25th. There are rumors of restructuring amid a cash crunch.”

In April of this year, the rapid trade company, after securing a substantial $75 million round of funding from investors including Reliance Retail and Google, made the difficult decision to lay off 30% of its workforce. . This move came on the heels of the funding announcement and was accompanied by a company-wide town hall meeting where management discussed a pivot in the business model. As part of this strategic shift, the company has also decided to close 50% of its dark stores across the country.

The financial records of the Ministry of Corporate Affairs documents for the 2021-22 fiscal year revealed the company’s difficult financial situation. Despite reporting a total revenue of 67.7 crore, the expenses incurred by the company amounted to a staggering 531.7 crore. Operating revenues showed an improvement, reaching 54.3 crore, as compared to 25.1 crore in the previous fiscal year. However, the company suffered a consolidated loss of 464 crore which is double the loss it made in the previous year.

The largest expense for the company was employee benefits which amounted to 138 crore. This was followed by significant advertising and promotional expenses, which rose to 64.4 crore as compared to 11 crore in the previous year.

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Updated: July 10, 2023, 2:20pm IST

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