Dunzo’s Bengaluru Dark Stores Back in Action as Off-Roll Workers Receive Payments
- ByStartupStory | August 22, 2023
Off-roll pickers at Dunzo, the Reliance Retail-backed quick commerce startup, have resumed their work at seven dark stores in Bengaluru following the receipt of their July salaries. This development comes after several employees had refused to return to work until their delayed salaries were paid. However, amidst uncertainties within the startup, some of these workers are exploring other job opportunities.
The report also highlights that Dunzo has two categories of employees – those on its payroll and others managed by third-party recruitment service providers. The third-party workers usually earn a monthly stipend of Rs 15,000-20,000.
One of the dark stores, located in Frazer Town area of Bengaluru, has been temporarily shut down as it transitions to a partner store model.
While Dunzo is in advanced discussions to secure up to $100 million in funding from existing investors Lightrock and Lightbox, Reliance Retail will not be participating in this funding round.
The funding might involve a 50% reduction in valuation for Dunzo, as reported by The Economic Times.
Dunzo has been grappling with a liquidity crisis and had announced plans to shift its business model from business-to-consumer to business-to-business (Dunzo for Business). The company had also shut down its Dunzo Daily service in most cities except Bengaluru due to financial challenges.
In April, Dunzo laid off around 300 employees, constituting about 30% of its workforce, as part of its cost-cutting measures.
Reliance Retail holds a significant stake in Dunzo, with Google also being a major shareholder. The quick commerce venture was valued at $757 million in May of the previous year.
The company has been exploring various funding options and debt restructuring to manage its cash flow and financial obligations. Meanwhile, Reliance’s JioMart has reportedly changed its cost structure for delivery partners, affecting Dunzo Merchant Services’ total business.
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