In a significant move reflecting the evolving dynamics of the foodtech industry, Zomato, one of India’s leading food delivery and quick commerce platforms, has reportedly laid off nearly 600 employees from its customer support team. The layoffs come as the company grapples with slowing growth in its core food delivery business and intensifying competition in the quick commerce sector, particularly through its subsidiary, Blinkit.
Zomato Layoffs: 600 Customer Support Jobs Cut Amid Food Delivery Slowdown and Quick Commerce Pressure
The decision, which has sent shockwaves through the workforce, is seen as part of Zomato’s broader strategy to streamline operations and reduce costs. Sources indicate that the affected employees were primarily hired under the Zomato Associate Accelerator Program (ZAAP) just a year ago, with promises of career growth and transitions into roles across sales, operations, and supply chain. However, the company has now shifted gears, leaning heavily into automation and artificial intelligence (AI) to handle customer support functions.
Zomato recently introduced “Nugget,” an AI-powered customer support platform designed to manage millions of interactions monthly across its services, including Zomato, Blinkit, and Hyperpure. This move toward automation appears to have reduced the need for a large human customer support team, rendering many positions redundant. While this technological pivot may boost operational efficiency, it has left hundreds of employees without jobs, raising concerns about job security in the rapidly changing tech landscape.
The food delivery vertical, once Zomato’s primary growth engine, has hit a plateau due to a consumption slowdown and challenges in expanding beyond major metropolitan areas. Meanwhile, Blinkit, acquired by Zomato in 2022, is facing mounting losses as it races to scale in the hyper-competitive quick commerce market, battling rivals like Swiggy’s Instamart and Zepto. These dual pressures have forced Zomato to rethink its workforce strategy, with customer support bearing the brunt of the cuts.
Employees affected by the layoffs have expressed frustration over the abrupt nature of the terminations. Reports suggest that many were let go without prior notice, receiving only a month’s salary as severance. The layoffs, concentrated in Zomato’s offices in Gurugram and Hyderabad, have sparked discussions about the balance between technological advancement and human employment in the gig economy.
As Zomato navigates this turbulent phase, the layoffs underscore broader trends in the foodtech and quick commerce sectors, where companies are increasingly turning to AI to cut costs and stay competitive. However, the human cost of such transitions remains a critical issue, with employees caught in the crossfire of innovation and market demands.
Zomato has yet to issue an official statement on the layoffs, leaving room for speculation about further restructuring in the coming months. For now, the company’s focus appears to be on weathering the storm of slowing growth and rising competition, even as it reshapes its workforce to align with a tech-driven future.
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