Alerzo, a Nigerian B2B e-commerce platform that digitizes commerce and payment processes between FMCG vendors and informal retailers, has laid off 15% of its full-time workforce.
BrandSpur Nigeria gathered that Alerzo initially laid off 5% of staff based on performance, with certain positions transitioning to digital systems, including an internal ERP. Subsequently, due to a requirement for increased profitability, a second round of layoffs ensued, impacting 15% of their full-time staff across departments, reducing the employee base to a total of 800.
The company’s rapid growth since inception led to hiring in large numbers, over 3,000 youths were employed within five years of existence, but the current economic climate has had an impact. In response, Alerzo has had to make adjustments to its business model in order to focus on achieving strong unit economics.
This, according to the company, required the reduction of its workforce despite previous aggressive hiring practices in the past few years, which enabled growth and expansion throughout the country.
Alerzo believes that the restructuring will enable better service to customers, while it pursues sustainable growth.
For affected employees who have seen their roles become redundant, Alerzo said it will pay all contractual notice periods, provide an additional month of severance pay, continue HMO coverage (including for members of the family covered) until the end of 2023 and would provide job placement and counseling services.
Meanwhile, Alerzo is one of the few African startups to have made two rounds of layoffs in the past year, including fintech Chipper Cash and e-commerce startup Sendy. Additionally, in what can be described as a trying few months for African e-commerce businesses, Jumia, as part of its streamlining efforts in the fourth quarter of last year, cut 900 positions across its 11 markets. , affecting 20% of its staff.