Rumor: Chinese Daily Deals Site Lashou.com Bracing for Huge Jobs Lay-Offs

Today, the Chinese media is reporting rumors from reliable sources that Lashou, one of China’s leading indie group buy sites, is about to lay off a significant amount of its nationwide workforce, with as much as 50 percent of staff in Shanghai and Beijing facing being fired.

The rumors cite leaks from Lashou staff, who claim that a massive internal restructuring is underway. One example given is that workers in the Lashou office in Suzhou have been forced, in recent weeks, to work until midnight without overtime pay; those who don’t comply face losing their job. The sources also say that 50 percent of Shanghai and Beijing staff will be forced out, but there’s no indication of how many jobs will be lost at the firm nationwide.

Just last month, we heard that Lashou is planning a US IPO in 2012.

It seems not even China’s top group buy sites are immune to this. Just yesterday we looked at the anger from users and businesses – and even street protests – that followed 55Tuan’s recent closure of 35 of its offices.

It has been even worse for those lower down the food chain in this way over-crowded sector, with the unofficial Groupon clone, Groupon.cn, having reportedly shed 80 percent of its staff since its inception.

We can look at this in two ways: either the whole daily deals model is unsustainable and heading for collapse; or – and this is where I come down – all such websites deliberately over-hired upon launch, so as to have as much personnel on the ground as possible, as if trying to win some 11th-century field-battle. And now, inevitably, even the more successful sites – such as Lashou – are having to trim back to more realistic staffing levels.

[Source: Techweb – article in Chinese]