Food and grocery delivery platform Foodpanda has laid off a number of its Singapore employees in a bid to reduce operating costs and maintain profitability.
According to The Straits Times, about five percent of the company's 1,200 staff in the country have been let go, equating to about 60 employees. The job cuts don't end there, however, with the company said to be planning to downsize in other regions as well. It reportedly plans to also axe up to 150 employees in the Philippines, along with more job cuts in Thailand.
The move comes just months after Foodpanda designated Singapore as its regional headquarters and global tech hub, marked by the opening of an office at Robinson Road.
When asked about the reported job cuts, a spokesperson for Foodpanda said that Berlin-based parent company, Delivery Hero, wants to stay Ebitda-positive, which means it wants to be profitable at an operating level. The spokesperson further stressed that there was a "critical need" to reduce costs to remain competitive in the market.
Delivery Hero's annual report in 2021 showed that it suffered losses in its Ebitda, which refers to its earnings before interest, taxes, depreciation and amortisation. Losses during that period amounted to about US$888.8 million, or about S$1.25 billion. The company did manage to enjoy an adjusted breakeven point in the second quarter of this year.
Foodpanda promises to support its retrenched staff members through the transition by providing them access to employee assistance programmes and extended insurance and benefits.
"To our impacted colleagues – we are very sorry we let them down; we will forever be grateful for their contributions and dedication to Foodpanda," said the company's spokesman.
Foodpanda has about 37% of the market share in the food delivery sector of Singapore. It had more than 10,000 delivery workers on its platform at the start of last year. Grab is perhaps its biggest local competitor, with more than 50% of the market share.
Foodpanda has laid off five percent of its Singapore staff, equating to about 60 employees, in a bid to reduce operating costs and maintain profitability.
The company also plans to cut jobs in other regional offices, including Thailand and the Philippines.
The move comes just months after Foodpanda designated Singapore as its regional headquarters and global tech hub, marked by the opening of an office in Robinson Road.