Jabong sees 19 per cent growth in revenue this fiscal
By Shubhangi Bidwe
29 Nov 2019
Jabong’s revenue jumped 19 per cent this financial year. The fashion platform’s expenses fell by six per cent. However, employee and finance expenses for the fiscal continued to soar, rising 22 per cent and 140 per cent.
US-based retailer Walmart owns Jabong. The merger of Flipkart’s fashion arms Myntra and Jabong led to massive layoffs with as many as 150 employees getting the axe. Myntra and Jabong together were asked to move all operations to Bangalore and cut workforce. Employees who didn't get the option to join in Bangalore were offered three months' pay as severance and 15 days of pay for every year served, besides gratuity. The conflict of interest arose from the fact that Flipkart already has its own fashion vertical -- Flipkart Fashion -- which is headed by Rishi Vasudev. Myntra and Jabong, along with their parent firm Flipkart, continue to dominate the online fashion market and have a 70 per cent market share in the country.
Earlier this year, Walmart decided to consolidate back-office functions for Myntra and Jabong to drive efficiencies. In going through that process, the team decided to focus on a single premium fashion platform, Myntra. On the cost front, it wouldn't have made sense for Walmart -- which acquired Flipkart -- to keep pumping cash into three different brands.