In August 2023, Twiga Foods, an e-commerce food distribution company, laid off a third of its workforce, amounting to 283 employees. The layoffs were part of an operational restructuring aimed at making the company more agile and cost-efficient amidst challenging market conditions. In this article, we'll discuss the reasons behind the layoffs, their impact, and what the future holds for Twiga Foods.
Twiga Foods' decision to lay off 283 employees was driven by operational restructuring in response to challenging market conditions. CEO Peter Njonjo emphasized the company's transformative path towards becoming leaner, more agile, and cost-efficient, which included reviewing its operating model and costs to ensure the organizational structure is fit for purpose. The declining purchasing power in the market also played a role in Twiga's strategic adjustments, such as replacing its internal sales team with independent contractors based on performance.
Twiga's layoffs and operational restructuring aim to make the company leaner and more cost-efficient. The shift to independent contractors is a significant cost-saving measure. In the short term, Twiga is focused on reducing operational costs, while in the long term, it aims to sustain its business by becoming more agile with investor support.
Post-layoffs, Twiga has adjusted its commercial model by replacing its internal sales team with independent contractors to enhance service delivery capacity. The company continues to invest in its Twiga Fresh vertical, cultivating onions, tomatoes, and watermelons. This restructuring aims to ensure Twiga's long-term viability and rebuild confidence among investors and customers by adapting to economic challenges and providing affordable goods and services.
Twiga's ongoing transformation into a more efficient and lean organization will likely shape its future impact on the food industry. By focusing on core operations like Twiga Fresh and transitioning to a model relying on independent contractors, the company may maintain or improve its service delivery in the long run. The layoffs reflect broader economic challenges within the industry, including declining purchasing power among consumers. Twiga's efforts to adapt to these conditions by becoming more cost-efficient could set a precedent for other companies in the food distribution sector, potentially leading to broader industry shifts towards more flexible and resilient operational models.
Twiga Foods laid off 283 employees due to operational restructuring and challenging market conditions, aiming for a leaner, more agile, and cost-efficient organization. The company replaced its internal sales team with independent contractors and continues to focus on its Twiga Fresh vertical. These changes may impact Twiga's future standing in the industry and influence broader market trends towards flexible operational models. Twiga's ongoing transformation could potentially lead to further strategic adjustments in response to evolving economic challenges.
