Copia, an e-commerce platform in Kenya focused on low-income households, has cut off 25% of its employees, or 350 people. The firm said that the layoffs were necessary due to rising labour costs and the need to increase earnings.
This is the third round of layoffs at Copia in this year. They cut off the 50 Kenyan employees earlier in the year and the 300 Ugandan staff in April of 2023. In the year 2023, Copia fired off a total of 700 employees.
Copia claims that the impending alterations would not impact the vast majority of its staff. Those affected will be given one month’s notice and are required to leave Copia before September in compliance with Kenyan labour rules. During this time, Copia’s management will evaluate the impacted workers and let them know their job status after one month has elapsed.
Read also: Copia halts Uganda operations due to economic downturn
Prioritizing profitability overall
In an official statement released to TechCabal it reads;
“Given that the economic downturn and the constrained capital markets are likely to continue for some time, Copia is optimising a number of key processes in its operations in Kenya to provide a better service to its customers and to drive sustained operating profitability. These changes require Copia to undergo a limited restructure of its operations.”
“While improving our operating model through digital, tech-led initiatives to drive faster profitability, this restructuring process will likely impact less than 25% of the permanent workforce and will be undertaken in full compliance with Kenyan labour law and with sensitivity to all employees affected by the process.”
“Copia’s Kenya operation is rapidly growing, providing e-commerce services to middle income consumers through an unrivaled high-quality, low-cost distribution network of over 50,000 agents. In addition, its service also provides local manufacturers with a unique, efficient route to market.”
“This limited restructure process is intended to ensure that during these economically challenging times, we will continue to focus our resources on the critical levers of business success and remain a lean and sustainable business for the long-term. This decision is consistent with many of the best companies in Africa and across the world which are responding to the market environment and prioritizing profit.”
“We are committed to working hard to achieve our goals and deliver sustainable profitability faster.”
Gartner forecasts, Global IT spending will grow 4.3 per cent in 2023
Uganda operations shut down
The firm had previously planned to enter the African retail market and had first expanded to Uganda after successfully acquiring capital.
Despite Copia’s plans to grow across Africa, the firm has of late shut down its operations in Uganda, citing the competitive market and the need to prioritise profitability first as reasons. Over 300 workers were laid off as a consequence of the company’s decision to end operations in Uganda.