Deliveroo has said it is axing around 9% of its workforce as it attempts to “demonstrate and accelerate a clear path to profits.”
In a press release, the food delivery service said 350 roles at all levels will be culled, although following redeployments, it expects this figure to be closer to 300. Deliveroo said it will offer enhanced redundancy packages above government requirements to those employees let go.
The group said it has taken this decision to show it can generate free cash flow after years of focusing “relentlessly on growth.”
Aside from that, Deliveroo said it is operating in a difficult consumer environment due to record high inflation, rising interest rates, energy crisis and fears of recession.
Additionally, the group grew its headcount in response to the boom experienced during the pandemic, but unforeseen macro headwinds and recently exited markets mean it does not require the same size workforce, it said.
“Quite bluntly, our fixed cost base is too big for our business,” said Deliveroo founder and CEO Will Shu.