Why did Ninjacart Lay Off its 200 Employees Explained

Pratiksha Bajikar Pratiksha Bajikar
Feb 27, 2021 6 min read
Why did Ninjacart Lay Off its 200 Employees Explained

Ninjacart recently laid off 200 of its employees working in middle and senior management. The agritech company attributes this layoff to poor performances and unmatched expectations. While the ex employees try to stain the company's image with stating about unethical HR practices, the management and CEO of Ninjacart are in complete denial.

Ninjacart is an agritech startup that provides fresh fruits and vegetables to retailers directly from the farmers. It supplies over 1400 tons of fresh produce directly from the farmers to supermarkets and kirana stores. Currently, is actively moving the farm products in seven major cities- Chennai, Mumbai, Ahmedabad, Hyderabad, Pune, Bengaluru and Delhi-NCR.

Ninjacart Latest News
About Ninjacart
Vision of Ninjacart
Ninjacart Investors
Why did Ninjacart Layoff 200 Employees
Unresolved issues from employees
How Ninjacart Hires
Casual Hiring Approach
FAQ

Ninjacart Latest News

23 February, 2021. Ninjacart announced that they are laying off 200 employees. Thirukumaran Nagarajan, the CEO of Ninjacart, said that the lay off was the result of issues with employee's performance.

About Ninjacart

Ninjacart is India's largest Fresh Produce Supply Chain Company. They are pioneers in solving one of the toughest supply chain problems of the world by leveraging innovative technology. They source fresh produce from farmers and deliver them to businesses within 12 hours.

The company works with farmers in Indian villages to produce fresh farm and deliver it on a pan India platform. When they saw that farmers are exposed to various challenges such as price risk, information asymmetry in demand, delayed payments or even insufficient knowledge on distribution, they decided to intervene and provide a channel to these farmers which would bring them better returns on their harvest.

Vision of Ninjacart

They looked at Retailers struggling with low quality produce, unhygienic products and everyday hassle to collect the harvest and pointed to it as a major concern. They also noticed that the traditional supply chain lacks efficiency, needs more organization and has a high rate of food wastage.

Successful businesses are those which take off with an intention to solve problems experienced on grass root levels. And Ninjacart was founded precisely for that. The founders, Sharath Loganathan, Thirukumaran Nagarajan, Vasudevan Chinnathambi, Kartheeswaran KK, Sachin Jose and Ashutosh Vikram made an impeccable team to work towards creating a better channel for the farm produce to reach the locals more efficiently.


Growth of AgriTech Startups in India
Since the Indus Valley Civilisation, agriculture has been the lifeline of India.We have 70% of Indian households still dependent on farming, contributing 17โ€“18%to the countryโ€™s GDP, according to the latest report. This creates a huge scope of agri-tech startups for Indiaโ€™s farmers who arestrivinโ€ฆ

Ninjacart Investors

Backed by several venture capitalists, such as TigerGobal, Mistletoe, ACCEL, including giants like Walmart and Flipkart, Ninjacart aims to eliminate intermediaries and take control of supply chain management. It is their goal to make sure farmers are paid rightly with consistent demand and retailers are supplied with fresh and hygienic products.

Why did Ninjacart Layoff 200 Employees

Possible reason of Ninjacart's layoff

As we address the elephant in the room, we are going to talk about why a company like Ninjacart, which, as an ongoing concern, is breaking grounds to upgrade trading conditions for farmers, is laying off so many employees all of a sudden?

Ninjacart laid off ย 200 employees across various functions at all employee levels. The labor cut happened across all ย its key geographics- Bengaluru, Chennai, Mumbai and Hyderabad.

Unresolved issues from employees

The employees complained of being given a 15 day notice period whereas every other company provides a 30 day notice period which is bare minimum. Employees at senior levels have shown dismay as they have removed from the company by issuing fake resignations. Employees said that they don't remember submitting any resignations and that their source was a portal used by the company's HR department.

The employees believe the laying off was a part of their cost-cutting drive but the company has denied all such claims. According to CEO Thirukumaran Nagarajan, โ€œOut of the 200 employees who were sent away, the majority of them were asked to leave due to performance issues. Every employee has an internal scorecard that we maintain so that whenever the performance dips below the expected KPIs, the manager (concerned) alerts him or her. If there is no improvement seen, the manager reports this to the HR who takes the final decision.โ€

โ€œWe have had cases of theft, including our own employees stealing our crates. We have found instances of several of our employees stealing crates of products and selling those in supermarkets and other offline markets. We were able to track down those employees in the past and terminate their jobs.โ€ Thirukumaran Nagarajan further added

Apart from the layoffs, employees have complained about their performance appraisals being put on hold. Many companies, owing to the pandemic conditions, have had similar cost saving measures in place and CEO Nagarajan claims to have paid all the said payouts.

โ€œWe have never had cost-cutting measures, but we did make a decision to postpone payments of variable pay components of employees in April after the lockdown. We had to take this decision as we were unsure about how the business might look like after the nationwide lockdown. However, we have already paid the variable pay to all employees in 4 equal instalments in the month of September, October, November and December. The annual variable pay payout is for the period of April 2019 to March 2020,โ€ he added.


[Infographic] Case Study on Layoffs Due to Coronavirus
Coronavirus has had a very bad impact on the economy. With the crash in theeconomy, a lot of people lost their jobs. Some people even believe thatunemployement will have even worse impact of peopleโ€™s mentality than the impactof coronavirus. Many companies laid off thousands of their employees iโ€ฆ

How Ninjacart Hires

Ninjacart calls upon innovators, problem solvers and executioners to be a part of their steadily growing team. It has a flexible schedule for its employees and aims to have a fun environment at work. It has hired several freshers, including some from IIM and middle and senior management level employees in the recent year and now going strong with 4000 plus employees.

Ninjacart Hiring Process
Ninjacart Hiring Process

Casual Hiring Approach

Ex employees claim that the company had a casual approach towards hiring and firing people. It hired a batch of freshers from IIM and later fired them when their performance fell below a certain matrix without batting an eyelid or even giving them a second chance to improve themselves. This led to a lot of instability and insecurity among the employees and some of them left the company themselves.

The agritech recently caught a hiccup due to a mass lay off and alleged unethical HR practices where employee IDs were hacked by team managers to submit fake resignations. The CEO, Nagarajan commented ย that senior managers do not have the final say on layoffs without communicating the decision first to the HR department.

โ€œThe issue of a manager taking control of some employeesโ€™ official accounts to force termination only happened in a few cases, and I have already communicated to these employees to contact me personally for an appropriate resolution,โ€ he added.

FAQ

How does Ninjacart make money?

Ninjacart is an AgriTech startup which allows farmers to sell their vegetables and fruits directly to retailers and restaurants without middlemen involved.

Who is the founder of Ninjacart?

Thirukumaran Nagarajan, Vasudevan Chinnathambi, Ashutosh Vikram, Kartheeswaran KK, and Sharath Babu Loganathan are founders of Ninjacart.

Why did Ninjacart lay off 200 Employees?

Ninjacart fired at least 200 employees citing performance and integrity issues, but employees believe the laying off was a part of their cost-cutting drive.

Conclusion

2020 Covid-19 pandemic left no stone unturned in messing up the world economy. Meanwhile, giants who stood tall taking hits from the pandemic, start up companies have struggled to even stay afloat. As we stated earlier, labor cut is a common practice when the company is in financial crisis and we surely empathize with that but the allegations Ninjacart are serious in nature.

HR practices form a very prominent and integral part of any organization. The preamble set by an organization's HR practices enable a smooth run for employees from the top management to ground level employees, and hence they need to be as transparent as possible. ย 

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