Heaptalk, Jakarta — A behemoth e-commerce Lazada announced to cut-off around 30% of Southeast Asia’s employees, including Indonesia. According to a Lazada spokesperson, the efficiency measure is carried out to improve the company’s adaptivity to resolve the coming business obstacles.
This layoffs reportedly affected several departments, such as the commercial and marketing teams. However, the company avoided disclosing the details of the affected employee numbers in Singapore and Southeast Asia.
This company has encountered stiff competition from its competitors, such as Sea Limited’s Shopee and TikTok Shop. Moreover, technology entities GoTo and TikTok announced a partnership whereby the Tokopedia and TikTok Shop businesses would be estimated to become larger entities.
“We conducted proactive adjustments to transform our workforce to better position ourselves in a more agile and efficient way of working to meet future business requisites. This transformation requisites,” The Lazada representative
Established in 2012, Lazada has been broadening its presence in multiple Southeast Asian markets, including Singapore, Indonesia, Malaysia, Thailand, Vietnam, and the Philippines. In 2016, Alibaba Group Holding officially acquired Lazada’s shares to broaden its existence in SEA.
Following this strategic effort, Alibaba spun into six central business units in March 2023, expected to unlock shareholder value and drive company’s growth. As a result, Lazada operates under Alibaba International Digital Commerce (AIDC), which includes the e-commerce platforms Daraz and Trendyol and an online store, AliExpress. Before laying off its employees, Lazada reportedly gained fresh injection from Alibaba at US$634 million at the end of the last year, generating its investment valuation of over US$1.8 billion in 2023.
As is known, these latest layoffs come amid speculation regarding AIDC’s potential initial public offering in the United States in 2024. The unit posted a 53% revenue increase compared to the previous year in the quarter ending September 2023.
Although companies are forced to position their business and workforce in the current economic conditions, Executive Director of Digital Industry (DISG) Singapore, Chan Ih-Ming, said his party will work closely with Lazada and related institutions to help affected employees gain other employment opportunities.
“The digital economy in Asia continues to evolve. We have a robust optimism for the long-term enhancement of the technology sector in Singapore,” said Chan, cited in Katadata.
