Baidu Waimai, China’s third-largest takeaway service which was acquired by Ele.me in August last year, is facing “structural adjustments,” according to insiders quoted by local media. Ele.me has denied that Baidu Waimai’s staff is facing layoffs. However, several former Baidu Waimai employees have said that the layoffs are in progress, according to Beijing Business Today (北京商报).
Last year, during the takeover, Ele.me promised to continue operating the two brands separately. In the meantime, Ele.me was taken over by Alibaba which bought the remaining shares in the company in April this year.
Baidu Waimai staff has been restless since the takeover in August. Aside from former Baidu Waimai COO Chen Qing, the company lost CTO Geng Yankun who left to join SF delivery service (顺丰). Finally, with the departure of CEO Gong Zhenbing, Baidu Waimai lost its entire core team. Some of the other high ranked staffers joined Didi’s new food delivery platform Didi Foodie, others Daojia Meishi.
An insider quoted by the report said that after Ele.me took over Baidu Waimai, the plan was to turn the latter into an entry point for Ele.me’s high-end users. The platform was to reorient towards higher quality service but not necessarily stay independent.
The report states that in many cities Baidu Waimai staff has received news of internal mergers in business development, product research, and other departments which do not bring much revenue. The integration would provide staffers an opportunity to transfer but since the number of positions is limited, Baidu Waimai employees quoted in the report believe that this is a way to reduce personnel.
Some of Baidu Waimai former employees moved on to join to the delivery service of Yum China (百胜中国) which operates KFC, Pizza Hut, and Taco Bell, according to the report. At the end of last year, Baisheng announced that it will launch its own delivery service called Baisheng Waisong (百胜外送) in a bid to compete in the market. The department is now headed by former Baidu Waimai COO Chen Qing.