Bengaluru: E-commerce companies Flipkart and Amazon, as well as other vertical etailers and online brands have deferred plans to hire thousands of additional staffers, a day after the government reversed its decision to allow online etailers to deliver all goods, including non-essential items, multiple people aware of the plans told ET.
Additionally, small sellers on these platforms said they are faced with a working capital crunch and the delay would force them to pay partial or no salaries for April.
The grim outlook comes a day after the Ministry of Home Affairs revised its April 15 guidelines. The new rules continued to exclude ecommerce firms from a list of businesses that are allowed to operate during the lockdown.
The economic impact of not opening up ecommerce for non-essentials is going to trickle down to the ecosystem, a senior executive at a leading ecommerce firm told ET. Executives and industry watchers pegged the number of deferred hires to be as high as 200,000 people.
Analysts and other company executives said contract labourers would lose jobs, while small sellers may permanently shut down.
Ecommerce companies will continue to bleed, they added.
“I am planning to pay only 50% salaries to my employees in April. We had earlier thought business would reopen in the second half of this month, but now that my revenues for April are going to be zero, I don’t think I can afford to,” said Harneet Singh, proprietor of Jewels Kafe, who decided not to reopen as his hometown Kota in Rajasthan continues to see a rising number of Covid-19 positive cases.
Last week, ET reported that businesses were contemplating cutting their temporary workforce by 40-60% in April to rein in costs amid the business uncertainty.
“With the continued lockdown, we can only operate at 30% capacity at best… the rest we will cut back in factories, warehousing centres, and office,” said a small online seller.
Another seller of personal care items on Flipkart and Amazon said the government flip-flop was shocking. “I was really hoping to do some business in April. Now I am doubtful if we will be allowed to sell even after May 3,” the seller, who asked not be named, said.
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Source: indiatimes.com
