As per the latest information, Jabong’s 400-strong workforce may be halved and its base shifted to Bengaluru from Gurugram.

Jabong to halve workforce as part of Flipkart restructuring Myntra CEO CFO may quit
Atom Jabong Friday, November 16, 2018 - 19:03

There is a spate of changes occurring at Flipart/Myntra/Jabong these days, just months into the new owners Walmart taking charge. It appears increasingly clear that at the macro level, the new management feels there may not be the need for so many different organisations and wherever these entities are engaged in similar type of activity, they can be integrated at the back end, while leaving the front- end function as before. The first casualty to this new thinking could be Jabong. As per the latest information, Jabong’s 400-strong workforce may be halved and its base shifted to Bengaluru from Gurugram. At one level, efforts are afoot to bring Flipkart fashion and Myntra together under one umbrella.

All these changes are happening or about to occur when there are massive shifts at the top management level. The biggest of them all was the departure of one of the co-founders of Flipkart, Binny Bansal, under not so pleasant circumstances. The next was where the CEO of Myntra-Jabong, Ananth Narayanan, was asked to report to the Flipkart CEO Kalyan Krishnamoorthy, a sort of clipping of his wings. Latest reports suggest Narayanan also has put in his papers. As per sources, Myntra-Jabong’s chief financial officer Dipanjan Roy has also stepped down. There are other senior level executives handling important functions, who have left already or are leaving now.

It is under these circumstances that this new move on downsizing Jabong and integrating several back-end functions of Flipkart Fashion, Myntra and Jabong is taking place. Though none of the entities involved have confirmed any of these, the wide sense is that Walmart would want to run one fashion vertical Flipkart Fashion, under which Myntra and Jabong may become sub-brands and retain their identities.

The concept of promoting private labels is quite acceptable to Walmart and it is expected to bring a few of its own private labels from the US to be included in the range in India. But in order to bring down the overall cost of running these different outfits and to downsize the operations, the necessary steps will be taken over the next few weeks.

To drive home this point, it is being highlighted that while there are 100 people managing the Flipkart Fashion business, Myntra has close to 1,000 people on its rolls, may be in addition to the 400 on Jabong’s rolls. These are things that will come under increasing scrutiny under the new dispensation. There’s some talk of under-performance by Myntra in the last year as one of the reasons for all these changes and it is also being pointed out that it was Jabong that pulled Myntra down.

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