To save company, Snapdeal bosses try Spicejet chief’s route
NEW DELHI: When online shop Snapdeal founders Kunal Bahl and Rohit Bansal told anxious staff that they would share the pain of the rank and file, they were following a lofty example: SpiceJet Chairman Ajay Singh had foregone his monthly envelope until the foundering airline revived.
According to sources, Bahl, Bansal and Singh met for lunch in January and over the meal the founders decided to lead by example. Singh followed up the lunch engagement with a visit to Snapdeal’s Gurgaon office on February 1to tell the top management ways to revive the retailer, sources told ET.
“The lunch meeting between the two founders and Singh also discussed change in strategy from going after market share through discounts to working towards profitability. The founders were also advised by Singh to lead by examples and take a pay cut before going for a pay cut of its employees,” said a source in the know, who did not want to be identified.
An email sent to Snapdeal did not elicit any response until the report went to print. However, a spokesperson confirmed to ET that Singh had visited the Snapdeal office. When contacted, Singh declined to comment on the issue. Singh is credited with turning around Spice-Jet after the airline went into partial closure in December 2014. He did not take any salary for about 15 months after joining the airline in January 2015.
On Wednesday, Bahl and Bansal, cofounders at Snapdeal, announced they would immediately forego their salaries, becoming the first among India’s high-profile startup entrepreneurs to do so: The move is aimed at conserving cash and cutting costs to turn around the fortunes of their seven-year-old firm. Interestingly, the internal letter, sent to employees, also mentions SpiceJet as a successful company that had gone through a phase of downturn.
“…That said, there is almost no successful company on the planet which hasn’t gone through this phase in their lifetime — Apple, Amazon, Netflix, Tesla, Lego, Spicejet, you name it! This will mean tough choices and a conscious departure from a me-too race to the edge of the cliff. Let’s remember: GMV is vanity, Profit is sanity,” reads the letter sent to employees on Wednesday and reported by ET on Thursday.
GMV, or gross merchandise value, is an industry term for the total value of merchandise sold on an ecommerce site.
During Singh’s February 1 visit, Snapdeal’s top management asked the SpiceJet turnaround man a lot of questions on the airline’s revival, employee morale and competition.
“Senior management at Snapdeal wanted to know about ways to deal with the low morale of employees and steps taken by Singh to turn around SpiceJet,” said the source.
Employees were interested in learning about ways to ‘deal with a large well-funded competitor that is going after market share,’ said the source.
According to sources, Bahl, Bansal and Singh met for lunch in January and over the meal the founders decided to lead by example. Singh followed up the lunch engagement with a visit to Snapdeal’s Gurgaon office on February 1to tell the top management ways to revive the retailer, sources told ET.
“The lunch meeting between the two founders and Singh also discussed change in strategy from going after market share through discounts to working towards profitability. The founders were also advised by Singh to lead by examples and take a pay cut before going for a pay cut of its employees,” said a source in the know, who did not want to be identified. An email sent to Snapdeal did not elicit any response until the report went to print. However, a spokesperson confirmed to ET that Singh had visited the Snapdeal office. When contacted, Singh declined to comment on the issue. Singh is credited with turning around Spice-Jet after the airline went into partial closure in December 2014. He did not take any salary for about 15 months after joining the airline in January 2015.
On Wednesday, Bahl and Bansal, cofounders at Snapdeal, announced they would immediately forego their salaries, becoming the first among India’s high-profile startup entrepreneurs to do so: The move is aimed at conserving cash and cutting costs to turn around the fortunes of their seven-year-old firm. Interestingly, the internal letter, sent to employees, also mentions SpiceJet as a successful company that had gone through a phase of downturn.
“…That said, there is almost no successful company on the planet which hasn’t gone through this phase in their lifetime — Apple, Amazon, Netflix, Tesla, Lego, Spicejet, you name it! This will mean tough choices and a conscious departure from a me-too race to the edge of the cliff. Let’s remember: GMV is vanity, Profit is sanity,” reads the letter sent to employees on Wednesday and reported by ET on Thursday.
GMV, or gross merchandise value, is an industry term for the total value of merchandise sold on an ecommerce site.
During Singh’s February 1 visit, Snapdeal’s top management asked the SpiceJet turnaround man a lot of questions on the airline’s revival, employee morale and competition.
“Senior management at Snapdeal wanted to know about ways to deal with the low morale of employees and steps taken by Singh to turn around SpiceJet,” said the source.
Employees were interested in learning about ways to ‘deal with a large well-funded competitor that is going after market share,’ said the source.
