Abof.com — an online fashion retailer platform launched by Aditya Birla Group, has decided to shut down its operations by the end of this year. The move comes as the platform failed to keep up with growth of its rivals Amazon and Flipkart.
As per the report from Economic Times, the company held a 20-minute townhall meeting yesterday to inform its employees that December 31 would be the last day of its operations.
Santrupt Misra, HR director at Aditya Birla Group confirmed this development and said:
Looking at how the big and long term e-commerce 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.
The company has a team of around 240 employees. As per the source, Abof.com is not laying off employees but the parent company, Aditya Birla Group, will try to absorb the employees. Santrupt says that those who wish to quit the company, will be given four and-a-half months’ salary as compensation.
Aditya Birla Group had launched Abof — short from Aditya Birla Online Fashion, and decided not to offer discounts and, instead, sell a more limited and fashionable range of merchandise. However, just over a year after its launch, the company had started offering about 70 percent discount on its portal.
The major reason behind closing down the online portal is that the competition is cut-throat in the online fashion sector and Abof was not able to match up to the standard set by Amazon India and Flipkart (Myntra and Jabong are part of Flipkart).
This is the second e-commerce venture from Aditya Birla Group to shut down operations. The company had previously launched TrendIn a couple of years back which has been shut down.