Alerzo, a Nigerian B2B e-commerce startup has laid off 15% of its full time employees in a second round of layoff within the last 7 months.
The first party e-commerce business which digitizes commerce and payment processes between fast moving consumer goods (FMCG) suppliers and informal retailers, had over 200 employees before a first layoff in September 2022 which affected 5% of its full time workforce.
Alerzo has clarified, per TechCrunch, that the first round of layoffs was performance related and due to the digitization of some roles including the development of an internal ERP, while the second round is due to profitability push.
Alerzo, which serves over 100,000 retailers, has experienced measurable growth following its $10.5 million Series A funding in 2021.
The company acquired Shago Payments, a fintech company to provide digital services to its informal retailers, made major expansion moves and aggressive nationwide hiring to sustain the expansion.
The expansion paid off as the company experienced more than a doubled-over growth in both the e-commerce business and the acquired payment arm in 2022.
However the impact of a broader economy after such rapid growth brings with it the need to restructure and cut back payroll to boost profit.
Alerzo said it will pay out all contractual notice periods for all affected employees as well as an additional one month severance. The company will also continue HMO coverage which includes covered family members until the end of 2023.
The severance package also includes provision of job placement and counseling services.
The company plans to dedicate the payment licenses it has received to the digitization of its merchants base, and hopes to achieve a breakeven and reach profitability by Q3, 2023.
