Off-roll pickers employed by Dunzo, the fast-commerce startup supported by Reliance Retail, have recommenced their duties at seven dark stores in Bengaluru. This decision follows the disbursement of their salaries for the month of July. Previously, a number of these workers had declined to resume work due to the postponed payment of their wages. Nonetheless, given the unsettled atmosphere within the startup, a portion of these employees are actively considering alternative job prospects.
Read More: Dunzo’s dark store operations grind to a halt as off-roll employees demand July salaries
The report also points out that Dunzo maintains two distinct groups of workers: those directly employed by the company and others overseen by third-party staffing agencies. Typically, the third-party staff receive a monthly stipend ranging from INR 15,000 to INR 20,000.
A dark store situated in the Frazer Town vicinity of Bengaluru has been temporarily closed as it undergoes a transition to a partner store model.
Although Dunzo is in the final stages of negotiations to obtain funding of around $100 million from its current investors Lightrock and Lightbox, Reliance Retail has chosen not to partake in this particular funding cycle.
Read More: Dunzo navigates series G funding talks amid controversy, eyes $100 Million investment
The funding could potentially result in Dunzo experiencing a 50% decrease in its valuation.
Read More: Dunzo’s financial distress intensifies amidst shareholder disputes over valuation decrease
Dunzo has been contending with a liquidity challenge and had disclosed intentions to transition its operational approach from business-to-consumer to business-to-business through the “Dunzo for Business” model. Furthermore, owing to financial difficulties, the company had also ceased its Dunzo Daily service in the majority of cities, excluding Bengaluru.
Read More: Dunzo4Business to extend operations, eyes entry into 10-15 new cities in the coming months
During the month of April, Dunzo implemented a workforce reduction, resulting in approximately 300 employees being laid off. This accounted for roughly 30% of the company’s total workforce, and was undertaken as a component of its cost-reduction strategies.
Read More: Dunzo downsizes workforce by 30% to cut costs as it secures $75 million in convertible note funding
Reliance Retail possesses a notable ownership share in Dunzo, while Google also holds a substantial stake as a major shareholder. As of May in the prior year, the quick commerce initiative had achieved a valuation of $757 million.
The company has been actively investigating diverse funding avenues and debt restructuring strategies in order to effectively handle its cash flow and financial commitments. Concurrently, reports indicate that Reliance’s JioMart has implemented alterations to its delivery partner cost structure, which has had an impact on the overall business of Dunzo Merchant Services.
