Snapdeal has vacated a 90-seat office in a co-working hub in Andheri in Mumbai that it picked up last year and is in the process of divesting about half of the space in its main corporate office in Gurgaon as part of its cost cutting drive, said a person aware of the move.
“The company does not want to operate out of the co-working space in Andheri anymore and has already moved it. Its sales team was working out of Awfis, a co-working company in Mumbai,” said a person directly aware of the details.
“Snapdeal plans to leave ASF Tower, where it occupies about 1.5 lakh sq ft, and some part of ASF Center, where it occupies 3.3 lakh sq ft,” said another person aware of the development. The SoftBank backed company had leased 480,000 sq ft of office space in the two commercial buildings in Udyog Vihar, Gurgaon, developed and owned by ASF Group.
Snapdeal was paying a monthly rent of Rs 55 per sq ft. The company has struggled to deal with declining sales and has been under pressure to cut costs. As per reports, Snapdeal laid off about 600 employees from the Gurgaon office last month.
Many e-commerce firms have taken to consolidation of office space recently including Flipkart that surrendered 70% of the space in its upcoming campus in Bengaluru to trim cost. In 2014 Flipkart signed the largest office transaction by an ecommerce firm for a 2 million sq ft campus.
“”The e-commerce industry is evolving as it matures to an established sector in India. Companies now are focusing on right-sizing their real estate requirement to ensure their space take-ups are optimized to their head count projections” said Naveen Nandwani, Managing Director – Bengaluru & Kochi, JLL India.
Snapdeal has also given up 50% office space in Gurgaon and will fire 30% of it’s staff in the next two months to cut cost.