Just months after tech company; Sendy laid off ten (10) percent of its entire workforce the Kenyan logistics startup has carried out another round of layoffs at a time when it has announced plans to gradually bring its supply service to a close and focus entirely on the fulfillment side of its services so as to provide its business clientele with more efficient service.
The company revealed that its decision to discontinue its supply arm has affected twenty (20) percent of its total staff strength of 270 employees. This translates to around 54 employees getting laid off and another indicator of the funding and capital difficulties faced by businesses worldwide in recent times.
Send has also been unable to raise its target of 100 million United States Dollars (which is around 12.21 billion Kenyan Shillings). It has also transitioned into providing its services to only businesses.
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The Chief Executive Officer (CEO) of Sendy; Meshack Alloys made it known that the company is not close to the projections that had been set for the previous quarter and as a result, changes have to occur in order for it to hit the next projections.
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In his words, “If we look at metrics, we’re headed in the right direction, especially our contribution margins, gross profits, take rates and EBIDTA.”
Meshack Alloys who co founded Sendy in 2015 alongside Don Okoth, Malaika Judd, and Evanson Biwott stated that, “However, the gap between where we are today and where we’re supposed to be is still huge. To put that into context, if you look at the last three months from a GMV perspective, we’re only 65% of where we need to be. And from a revenue perspective about 44%. So the gap is quite huge. And we need to do something about it, given the tough economic conditions we’re seeing.”
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Sendy’s Chief Executive Officer (CEO) made it known when revealing that it is leaving its supply product that, Sendy Fulfillment is its main product with a larger target market and will not be impacted by fluctuations in prices unlike its Supply product.
According to him, “With the growing uptake of digital commerce and recognizing the opportunities it presents for businesses, we are doubling down on fulfillment to support online merchants with the necessary tools to sell and fulfill directly through digital platforms.”
He added that, “We understand the potential of digital commerce, therefore Sendy will now sharpen its focus and invest resources in building fulfillment and transport services for businesses.”
Sendy’s fulfillment service currently provides packing, storage and delivery of goods to its customers. Its supply service made it possible for its users to buy Fast Moving Consumer Goods (FMCGs) from manufacturers directly.
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According to Meshack Alloys, “This move is part of our wider strategic focus to consolidate efforts around solutions that impact more customers and speak to the current and immediate market challenges.”
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Other companies that provide such services in Africa are TradeDepot, Sabi, and Wasoko.
Startups worldwide have in the past couple of months been faced with financial struggles. Kenyan based Kune Food which was a cloud kitchen or food tech company closed down its operations due to the financial struggles it faced. Vezeeta, Wave and 54gene have had to either lay off their employees or carry out salary reductions.
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Global giants like Hopin, Robinhood, On Deck, and Gemini have all had to carry two rounds of redundancies in recent times. As at the time of putting this article together Sendy was the first to announce two rounds of redundancies in Africa.
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