Carousell Group cuts 110 roles, leaders take voluntary pay cut

Carousell Group cuts 110 roles, leaders take voluntary pay cut

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Carousell Group is reducing 110 roles, representing 10% of the group's total headcount. As part of cost savings, it is also moving to an office with significantly lower rent, and the co-founders and group leadership will take voluntary pay cuts.

CEO Quek Siu Rui (pictured right) said only teammates from some business units are affected. "I am deeply sorry for this outcome, and I take responsibility for the decisions that have led us here," he said. MARKETING-INTERACTIVE has reached out to Carousell for additional information on the marketing team's impact.

Quek said he was too optimistic about the pace of the company's impact versus its increase in investments. The company had initially been optimistic about the recovery that was to come when the company emerged from COVID-19 lockdowns across key markets of the group. It also doubled down on a number of new initiatives to make selling and buying more convenient and trusted. That meant creating more teams to work on these initiatives, which included new teammates that Carousell had to hire.

"The reality is that we were quick to grow our expenses and hire, but the returns took longer than expected," Quek said.

He explained that while it is easy to blame market conditions, Quek said he also underestimated the impact of growing the team size too quickly. "Larger teams lead to lack of clarity in decision making and the additional coordination required to get things done," he added.

It also does not help that the worsening macroeconomic environment presents more headwinds to the growth expected, Quek said. According to him, as early as March this year, Carousell saw signs of what has been called the “perfect long storm”: high inflation, geopolitical risks and supply chain disruption. In recent weeks, things have taken a turn for the worse. The global economy continues to face steep challenges, with economists expecting a broad-based slowdown in 2023, he said.

"As we do not know when market conditions will improve, it is only prudent that we get to profitability as a group as quickly as possible, to be masters of our destiny and build an enduring company," Quek added. Hence, the team spent the last few months finding as many non-people cost savings as possible – combing through the company's budget, line by line and business unit by business unit.

Quek said this is "far from enough" despite the voluntary pay cuts and office move. To accelerate its path to profitability, Carousell will need to reorganise to focus on critical priorities and operate more efficiently. Hence, the job cuts.

Impacted employees will receive assistance from the group including having access to internal talent acquisition team and affiliated agencies to provide career counselling and employment assistance; providing tools for job search, and having access to an Employee Assistance Programme.

"Moving forward, we will sharpen our priorities as a company, keep a watchful eye on costs and only invest in high-conviction initiatives that are properly set up for success. We will gather next week to reiterate our strategic choices and share the refinements we will be making to reflect our learnings," Quek said.

Carousell is among the companies that have laid off employees recently, including Meta, Twitter, Flash Coffee, foodpanda, and Netflix. In October, its operations in Singapore experienced a data breach with approximately 1.95 million accounts being compromised. This formed 39% of its user accounts in Singapore, The Straits Times said previously. The Personal Data Protection Commission was also alerted of the situation.

Meanwhile, Carousell is also working closely with NTUC-affiliated union, Creative Media and Publishing Union (CMPU), to ensure that the reorganisation is carried out in a fair, transparent, and responsible manner, observing the principles outlined in the NTUC Fair Retrenchment Framework.

Both parties are also ensuring that the job cuts are also in line with the existing Tripartite Advisory on Managing Excess Manpower and Responsible Retrenchment to the fullest extent possible.

Carousell has assured CMPU that affected employees will be accorded fair compensation with what has been negotiated and agreed upon with CMPU, which is also in line with the Tripartite Advisory on Managing Excess Manpower and Responsible Retrenchment.

Carousell and CMPU are working closely with NTUC’s e2i to provide employment facilitation and assistance, including career coaching and job matching services for affected employees.

CMPU understands that this decision does not come lightly to Carousell. The union stands in solidarity with the affected employees, and its immediate priority is to continue working closely with Carousell to ensure that these workers receive the necessary assistance and support.

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