Financially stressed quick commerce start-up Dunzo is facing a new challenge as off-roll employees of the company’s dark stores in Bengaluru have stopped work after their July salaries were delayed, according to sources.
The trouble started brewing at the start of the week as several off-roll employees in the city stopped work demanding salaries for the month of July.
The off-roll employees are primarily involved in packing groceries and handing it to assigned delivery partners in Dunzo Daily service.
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“There have been nearly 70 off-roll employees of the dark stores whose salaries have also not been released,” said one of the sources on the condition of anonymity.
“We have built a hybrid network of stores for Dunzo Daily, which is a combination of dark stores and partner stores. This network is dynamic and continues to evolve. Where it makes business sense for us to have partner stores, we will switch to that model. We are live in more than 95 per cent of our geos in Bengaluru, except in a couple of areas where we are transitioning to partner stores. We should be operational in these areas soon,” said a Dunzo spokesperson when businessline reached out for comments.
The Bengaluru-based firm have dark stores in single digits now — all in its home market of Bengaluru — down from about 250 across the country.
“Dunzo had nearly 250 stores all over the country, but right now it has come down to single digits,” said another source.
This comes at a time when the quick-commerce player is facing financial difficulties and has laid-off nearly 300 employees as a part of the cost-cutting measures.
Last month, businessline had reported that the company had deferred salaries for its active and laid-off employees till September 4. The company has also pivoted to business-to-business (Dunzo for Business) from business-to-consumer.
Dunzo had last raised $75 million in convertible notes, from existing investors Google and Reliance Retail.
Reliance Retail, largest shareholder in the company, holds close to 25.56 per cent share in the company, while Google holds about 18.53 per cent, according to market intelligence firm Tracxn.
Dunzo was valued at $757 million as of May 2022 and has raised $497 million in equity investment till date, per Tracxn.