Quick-commerce firm Zepto has removed around 300 employees from its payroll to reduce costs, according to Moneycontrol. These employees have been reassigned to third-party service providers who handle tasks for Zepto and other companies.
Context: Funding and Valuation
The layoffs come shortly after Zepto raised $450 million in fresh funding, bringing its valuation to $7 billion, up 40% from last year’s $5 billion valuation.
Focus on Automation and Efficiency
A Zepto spokesperson explained that the move is part of a broader effort to control monthly employee costs without affecting productivity. Over the past six months, Zepto has automated operational tasks such as invoice processing, replenishment, and real estate management, primarily handled by off-roll staff.
Departments affected include operations, technology, category management, finance, and customer support, with automation driving a significant reduction in headcount. Since the start of the year, around 1,000 employees have left the company due to workflow automation.
Leadership on Cost Management
During a town hall on October 17, Zepto CEO Aadit Palicha emphasized cost discipline, saying the company will “obsess over costs” and adopt a frugal approach. Measures include reducing AWS and software spending, building internal dashboards, and limiting new hires to only essential positions while aiming to double business with the same headcount.
Competitive Landscape
Zepto competes with Blinkit, Instamart, and newer entrants like Amazon and Flipkart Minutes, intensifying the fast-growing quick-commerce market in India. The company’s focus on automation and cost efficiency is seen as a strategic response to the increasingly competitive environment.
