Shoppers Stop Lays off 1,100+ Employees
Retailer Shoppers Stop Lays off 1,100+ Employees in India – the country’s oldest retail store chain Shoppers Stop, is about to lays off more than 1,100 employees and closing some stores due to lower sales and bleak future demand outlook due to Covid-19 pandemic and national lockdown.
Shoppers Stop is having 7500+ staff strength, out of which 15%, mostly junior and mid-level workers have been asked to resign by June 15 as reported by ET. These include 160 people in the back-end operations and over 1,000 front end store level employees.
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ET has also informed that the company has confirmed the layoff plans, but said it will re-hire from the same set of people once situation begins to improve.The impacted employees will be given two months’ salary on an immediate basis. The company’s salary costs is about Rs 315 crore, or 15% of their annual sales.
Like other retailers, we will be looking at closing lower performing and unsustainable stores, a Shoppers Stop spokesperson said. “With the declining business, layoffs are unfortunately inevitable. With a limitation on adding new stores in this situation, the size of our business is effectively reduced and, therefore, unfortunately we need to adjust our cost base in such times.
With the government relaxing the lockdown and allowing malls to operate, Shoppers Stop has reopened 55 of its 90 department stores after a gap of more than two months but they are getting a very tough competition from online eCommerce platforms like Flipkart, Amazon, Myntra etc.
More than two years ago, Amazon had acquired a 5% stake in Shoppers Stop and to comply with changed regulatory requirements, the department store chain set up a subsidiary for its online portal to directly sell at the eCommerce giant’s portal.
In India, many retailers including Future Group and Shoppers Stop have made steep cuts in pay with top management even forgoing salaries completely.