Bengaluru : Flipkart-owned fashion retailer Jabong will merge with its sister company Myntra, which will continue to operate as a separate brand, in a move that could lead to a 10 per cent reduction in the combined workforce. Also, Myntra Chief Executive Ananth Narayanan (pictured) will continue to lead the Myntra-Jabong team, the company said, dismissing speculations about his exit.
The development comes days after Flipkart co-founder Binny Bansal stepped down as chairman and group CEO following an allegation of “serious personal misconduct” against him.
There was tension in the air at Jabong’s Gurugram office as anxious employees waited to be told if they were safe or would be let go. Narayanan, who himself flew to Gurugram, told them that the company would do away with the duplication of roles between Myntra and Jabong to effect a tighter integration. Sources in the company said job losses due to this integration could be around 10 per cent of the combined workforce of Myntra and Jabong, or roughly 200 employees. Jabong is learnt to have around 400 employees on its rolls, while Myntra has 1,500-1,600. Multiple sources also confirmed that the company would be shutting down the Gurugram office, even though a Myntra spokesperson denied any such plan.
Most job losses are expected in functions such as category, sourcing, and design where there is still a duplication of roles. Over the past one year, Myntra has merged Jabong’s technology and supply chain teams with that of its own.
“From Monday, Myntra category heads have been asked to run Jabong. The sense that employees are getting is that planners from Jabong will be retained because they are they only layer of continuity, but they will be asked to sit out of Myntra’s office in Bengaluru,” said a source.
Narayanan, who was earlier against the merger of the two fashion e-tail companies, is learnt to meeting each Jabong employee one-to-one as the company gears up for one of its biggest transformations since US retail giant Walmart acquired a majority stake in parent Flipkart in May.
“November has always been a month of big changes at Jabong, including some unpleasant ones. But somehow, Jabong has always bounced back in a newer and stronger version. We are waiting to see what happens this time as it’s not going to be Jabong anymore,” said a senior Jabong employee, who quit the company recently. In a separate email issued through its public relations agency in India, the company said Jabong’s brand identity, as well as independence, would be retained after the integration.
“Since Myntra’s purchase of Jabong in mid-2016, the two brands have been steadily integrating key business functions and streamlining processes. This has resulted in revenue growth and a significant improvement in customer experience. As the next step in this process, Myntra and Jabong will now fully integrate all the remaining functions including technology, marketing, category, revenue, finance and creative teams,” it said. “The closer integration of Myntra and Jabong is a necessary step in our continuing development.” HR experts said that following such a restructuring, people would not be out of job for long since other e-commerce companies were also hiring majorly and it was just an outcome of the location change, skill requirement or the changing DNA of the organisation.
“This move is just an indication and outcome of any merger or acquisition happening in the industry, and the rationale is to get rid of the duplicity. This does not mean that exodus of e-commerce would start happening. However, there may be a rationalisation of manpower, which will happen, and since e-commerce companies are growing exponentially, a lot of inside opportunities must be available,” said Mayur Saraswat, head of digital, IT and telecom vertical, TeamLease Services.
RBI asks banks to grout ATMs to wall, floor for security by September-end
Mumbai: The Reserve Bank asked banks to ensure their ATMs are grouted to a wall, pillar, or floor by September-end, except those installed in high secured premises such as airports, to enhance security of the cash vending machines.
In 2016, the RBI had st up a Committee on Currency Movement (CCM) to review the entire gamut of security of treasure in transit.
Based on the recommendations of the panel, the central bank has now issued instructions aimed at mitigating risks in ATM operations and enhancing security.
As part of the security measures, all “ATMs shall be operated for cash replenishment only with digital One Time Combination (OTC) locks”.
Also, “All ATMs shall be grouted to a structure (wall, pillar, floor, etc.) by September 30, 2019, except for ATMs installed in highly secured premises such as airports, etc. which have adequate CCTV coverage and are guarded by state/central security personnel”.
Further, banks may also consider rolling out a comprehensive e-surveillance mechanism at the ATMs to ensure timely alerts and quick response, it said.
The new measures to be adopted by banks are in addition to the existing instructions, practices and guidance issued by the RBI and law enforcement agencies.
The RBI also warned the banks that non-adherence of timelines or non-observance of the instructions would attract regulatory action including levy of penalty.
SBI refuses to disclose communication from RBI, govt on electoral bonds
New Delhi: The State Bank of India has refused to disclose any communication it received from the government or the Reserve Bank of India on electoral bonds, terming it “personal information” and held in “fiduciary capacity”.
Responding to an RTI filed by Pune-based activist Vihar Durve who had demanded copies of all letters, correspondence, directions, notifications or e-mails received from the RBI or any government department between 2017 and 2019, the SBI said it cannot be provided by it.
The bank cited two exemption clauses under the RTI Act to deny information — Section 8(1)(e) which pertains to information held in fiduciary capacity and Section 8(1)(J) which pertains to personal information of a person which has no link to any public activity.
“Information sought by the applicant cannot be disclosed as it is in fiduciary capacity, disclosure of which is exempted under Section 8(1)(e) and 8(1)(j) of the RTI Act, 2005,” the Central Public Information Officer of the bank said in his reply.
The bank also refused to give any details of action taken by it on such communications from the RBI and the government.
The electoral bonds, for giving donations to political parties, are being sold through SBI only. The sale opens in SBI branches when the Finance Ministry issues a notification of their sale for a given period.
The scheme of electoral bonds notified by the Centre in 2018 has been challenged in the Supreme Court.
Only the political parties registered under Section 29A of the Representation of the People Act, 1951 (43 of 1951) and which secured not less than one per cent of the votes polled in the last general election to the House of the People or the Legislative Assembly of the State, shall be eligible to receive the bonds.
The bonds may be purchased by a person who is a citizen of India “or incorporated or established in India,” the government had said in a statement last year.
The bonds remain valid for 15 days and can be encashed by an eligible political party only through an account with the authorised bank within that period only.
A voluntary group working in the field of electoral reforms, Association for Democratic Reforms (ADR), has demanded a stay on the sale while the CPI(M) has challenged it before the Supreme Court in separate petitions.
ADR recently filed an application in the Supreme Court seeking a stay on the Electoral Bond Scheme, 2018 which was notified by the Centre in January last year.
Walmart’s Flipkart, Indian startup GOQii settle dispute over sharp discounting
New Delhi: Walmart unit Flipkart has settled a legal dispute with an Indian startup that alleged it suffered losses because its products were sharply discounted on the global retailer’s website.
GOQii, a seller of smartwatch-type health devices, sued Flipkart last month in a Mumbai court, alleging its devices were discounted by around 70 per cent to the retail price, much more than the two sides had agreed. The court had, as an interim measure, ordered device sales to be halted on Flipkart.
In a joint statement , the companies said the dispute had been resolved and GOQii health devices would again be available on Flipkart. They didn’t say how the settlement was reached.
Vishal Gondal, CEO of GOQii, told Reuters the company would withdraw the case against Flipkart. The e-commerce retailer’s “team worked on a resolution benefitting the brand and the customers”, Gondal said in the statement.
The legal spat was seen as a test case of the giant retailer’s operating strategy in the country.
Small traders and a right-wing group close to Prime Minister Narendra Modi’s ruling party have raised concerns about large e-commerce companies, saying they burn billions of dollars deeply discounting some products to lure customers onto their sites, in the expectation that they will also buy other goods.
GOQii said it signed an agreement last year with a Flipkart unit to sell two of its devices at a price not below 1,999 rupees (USD 28.63) and 1,499 rupees. It later found the devices were being sold for 999 rupees and 699 rupees, calling it “unauthorized” discounting.
In response, Flipkart said it reserved “the right to institute actions for defamation, both civil and criminal”, arguing it wasn’t responsible for any discounts which are determined by third-party firms which sell via its website.
The two companies struck a friendlier tone in their joint-statement on Friday as they brought the legal battle to an end.
“We have ensured constant engagement with GOQii to resolve any differences,” Flipkart said in the statement.
With a 19 per cent market share, GOQii was the second-biggest player in India’s so-called wearables market last year, data from industry tracker IDC showed. The market is dominated by China’s Xiaomi, with Samsung a small player.
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