Zomato pulls out from 225 Indian cities owing to massive loss
By MYBRANDBOOK
After incurring losses of Rs346.6 crore in the quarter which ended in December, India's Food delivery giant Zomato stopped its operations in 225 small cities.
During its third-quarter financial earnings report, Zomato noted that the losses of the food delivery tech company have widened further, as the business of food delivery slowed down. The company announced that the operations in 225 smaller cities have ceased as its performance in these specific cities was 'not very encouraging'.
"The current slowdown in demand was unexpected, which is impacting the growth in food delivery profits. But despite that, we think we are in a good position to meet our profitability goal," the company said in its Q3 report.
In its financial earning report, the company noted that the food delivery application exited from "225 smaller cities in January, which contributed 0.3% of its gross order value in the December quarter".
Speaking about the decision, the company stated, "Performance of these cities was not very encouraging in the past few quarters, and we did not feel the payback period on our investments in these cities was acceptable."
The food delivery company further talked about relaunching the Gold subscription to boost its profits. "We launched a brand-new membership program, Zomato Gold, in late January... We expect this program to drive loyalty and higher frequency of ordering going forward," the company said, further claiming that more than 9 lakh members have taken the subscription.
Zomato CEO Deepinder Goyal recently announced the company’s plan to hire 800 people for different vacancies and post various job vacancies on LinkedIn. However, in one of the job posts, the requirement was posted 'work 24*7 with no work life balance', due to which the company faced backlash from people.
"Hello everyone – we have about 800 positions open across these 5 roles at Zomato. If you happen to know someone really good for any of these roles, please tag them on this thread. To express interest in knowing more about any of these roles, please email me at deepinder@zomato.com – me and/or my team will be prompt in responding to you and closing the loop either way," Goyal wrote.
In the job post, the Zomato CEO stated, "As the Chief of Staff to one of our CEOs (Zomato, Blinklt, Hyperpure), you will be nothing less than a force multiplier and a mini-CEO for the organization. You will drive large priorities across the organization to influence outcomes and maintain momentum. This is a 24-7 job, and the traditional employee mindset of "work life balance" won't work."
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