Bangalore based fashion e-tailer Voonik has told its 200 employees that the company won’t be able to pay them their salaries for the next three months. The company is taking massive cost-cutting measures.
Voonik has a total workforce of about 350 people in various departments like product development and customer support and operations team. For now only the product development and customer support employees are asked to drop their salaries.
The company’s co-founder and CEO Sujayath Ali said that employees who would resign will be given one month’s salary. Earlier this year Snapdeal took similar kind of step where it asked hundreds of its staff to leave as it struggled to raise funds. Voonik competes with bigger rivals like Myntra, Jabong, Amazon, and Limeroad. The company has not been able to scale its business after having raised around $30 million in equity capital.
Other vertical e-commerce sites like Craftsvilla and Zivame have also gone through major restructuring amid tough fund-raising conditions and businesses that have found it difficult to compete with the might of Myntra-Jabong and Amazon.
Voonik was previously funded by investment firms like Sequoia, RB Investments, Japanese e-commerce operator Beenos, Singapore-based venture capital fund Beenext, Tancom Investments and Times Internet, the digital product and investment arm of the Times Group, the publisher of this newspaper.
