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Carousell cuts 10% of total headcount to reduce costs

The company's chief executive Quek Siu Rui said that only employees from some business units were affected.

Carousell cuts 10% of total headcount to reduce costs

A logo of online classifieds marketplace Carousell is seen on the wall. (Photo: Carousell)

SINGAPORE: E-commerce platform Carousell announced it is cutting 10 per cent of the group's total headcount, or about 110 roles, as part of efforts to cut costs. 

The company's chief executive Quek Siu Rui said on Thursday (Dec 1) that only employees from some business units were affected. Those affected were informed by email and were also invited to a meeting with a team leader and a human resources business partner. 

Mr Quek said this was a "very difficult decision".

"I am deeply sorry for this outcome, and I take responsibility for the decisions that have led us here." 

The affected regular employees will receive at least three months' salary, allowed to encash all remaining paid time-off, and have their medical benefits and insurance coverage extended until June 30, 2023, among other measures. 

Tools for job search, counselling services for emotional and mental support, as well as career counselling and employment assistance will be provided to those affected.

EAGER TO REIGNITE GROWTH AFTER COVID-19

Mr Quek said Carousell was eager to reignite growth in its core classified business after the COVID-19 pandemic, and was also optimistic about the recovery to come. 

The company had doubled down on a number of new initiatives, which meant creating more teams to work on them and increasing its headcount. 

"Looking back, I’d made the following critical mistakes," said Mr Quek. 

He said he was firstly too optimistic about the pace of Carousell's impact versus its increase in its investments. The company was quick to grow its expenses and hire, but the returns took longer than expected. 

Mr Quek added he also underestimated the impact of growing the company's team size too quickly - larger teams led to a lack of clarity in decision-making and the additional coordination required to get things done. 

"It does not help that the worsening macroeconomic environment presents more headwinds to the growth expected." 

High inflation, geopolitical risks and supply chain disruption also continue to challenge the global economy, with economists expecting a broad-based slowdown in 2023. 

"As we do not know when market conditions will improve, it is only prudent that we get to profitability as a group as quickly as possible," he said. 

Mr Quek said he and other leaders in Carousell spent the last few months finding as many cost savings as possible without affecting the employees, with plans to move to an office with lower rent, and taking voluntary pay cuts. 

However, it was "far from enough", he added. 

Mr Quek apologised to the employees who were leaving and said the decision was "by no means a reflection of your contributions, dedication and hard work" during their time with the company. 

On Monday, Manpower Minister Tan See Leng told Parliament that there has been an increase in the number of retrenchments in the tech sector, with 1,270 local workers laid off from July to mid-November. 

TwitterFacebook parent Meta and Shopee are among the tech companies that have laid off workers in Singapore this year.

In a separate statement on Friday, the Creative Media and Publishing Union (CMPU) said it working closely with Carousell to ensure that the company's reorganisation is carried out in a fair, transparent, and responsible manner. 

CMPU, which is affiliated with the National Trades Union Congress (NTUC), said Carousell had assured the union that affected employees will be given fair compensation with what was negotiated and agreed upon with CMPU. 

Both parties are also working closely with NTUC's e2i to provide employment facilitation and assistance, including career coaching and job matching services for employees affected. 

"CMPU understands that this decision does not come lightly to Carousell.

"The union stands in solidarity with the affected employees, and its immediate priority is to continue working closely with Carousell to ensure that these workers receive the necessary assistance and support."

Source: CNA/lk(sn)

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