Local social commerce company Meesho has reportedly shut down its grocery division in India. The service, called Superstore, has been shut down in more than 90% of Indian cities (excluding Nagpur and Mysore), causing massive job losses.
Nearly 300 Meesho employees have reportedly lost their jobs due to the closure of Meesho supermarkets.
The company has yet to respond to the news.
Meesho rebranded Farmiso as Superstore in April to reflect its continued focus on meeting consumer demand for everyday essentials at Tier 2 and above.
That same month, the company laid off more than 150 employees, mostly from Farmiso, to integrate its grocery store into the core app.
During the first wave of the pandemic, the social commerce platform laid off more than 200 employees.
This time around, “low income and high cash burn are the reasons for the startup’s decision to suspend operations in most cities,” according to the report.
Meesho Superstore operates in six states of India: Karnataka, Telangana, Andhra Pradesh, Gujarat, Madhya Pradesh and Maharashtra.
Meesho is reportedly offering two months of salary as severance pay for the layoffs.
Meesho founder and CEO Vidit Aatrey said the company is excited to integrate Meesho Superstore into its core app.
“Starting with a pilot in Karnataka, it is now gaining traction in six states. The integration, driven by our user-first mindset, will provide a unified shopping experience for millions of Meesho users, while also enabling us to Areas such as acquisition, technology, product and talent drive greater synergies,” he explained in a statement.
Meesho has launched a pilot program in Karnataka to make online grocery shopping more affordable, with the goal of expanding Superstore to 12 states by the end of 2022.
Meesho Marketplace provides Small and Medium Enterprises (SMEs), Micro Enterprises, Small and Medium Enterprises (MSMEs) and Sole Traders with access to millions of customers in over 700 categories and pan-India logistics as well as payment services and customer support.
Meesho recently surpassed 100 million active users. According to the company, the number of trading users on the platform has grown 5.5 times since March 2021, while assortments have increased 9 times to 72 million.