Aditya Birla Group: Aditya Birla Group to Shut ecommerce site

News Image

New Delhi: Aditya Birla Group’s flagship ecommerce site will close down its operations by the year end, unable to compete against the heavy discounting model of online rivals such as Flipkart and Amazon.

On Thursday morning, Abof  short for Aditya Birla Online Fashion  held a 20-minute townhall meeting and informed its employees that December 31 would be the last day of its operations, two people aware of the development told ET.

Santrupt Misra, HR director at Aditya Birla Group, confirmed the group’s exit from online retail space. “Looking at how the big and long term ecommerce businesses continue to struggle and are unlikely to make money for some time, it did not seem logical to continue as if everything is all right in the sector,” he said.Misra said all the 240 employees of Abof will be given four and-a-half months’ salary as compensation, in case they wish to quit the company.

This is the second ecommerce venture closure for Aditya Birla that wound up last year for the same reasons. Abof launched in October 2015. “November onwards they will start closing down their stocks,” said one of the two sources cited earlier.The other source said brand Skult, which was exclusively available on Abof, will be absorbed by the group’s branded apparel division Madura Fashion & Lifestyle.

Aditya Birla Group launched Abof saying the site would not offer discounts and, instead, sell a more limited and fashionable range of merchandise. In an interview in March, chief executive Prashant Gupta had told ET that their “target consumer is not the guy who is looking for a deal”.But more than a year later, about 70% of the products on the portal were available on discount.


Friday, 22 September 2017

<< Back To Corporate News