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Wayfair cuts 1,650 global staff in restructuring
https://www.whatjobs.com/news/usa/us-employment-news/wayfair-cuts-1650-global-staff-in-restructuring
By Nithya Bose in Business News, posted January 22, 2024
Wayfair will reduce its workforce by 13 percent, affecting 1,650 employees globally in a third restructuring since the summer of 2022.
The retailer continues to streamline operations, eliminate management layers, and reduce costs.
Wayfair's co-founder and CEO, Niraj Shah, described it as an excessive surge in corporate hiring during the Covid-19 pandemic.
The layoffs primarily target management and leadership positions, constituting 19 percent of the corporate team.
Wayfair aims to save approximately $280 million through this restructuring.
It said the cuts are not attributed to fourth-quarter performance but are a proactive measure to align with its core structure.
Shah said: “The changes announced today reflect a return to our core principles on resource allocation.”
Wayfair's rapid expansion during the pandemic was driven by increased demand for home goods.
Its annualized sales skyrocketed from $9 billion to $18 billion.
However, as the impact of the virus diminished, the home goods sector faced a decline in demand.
It prompted Wayfair to make strategic cuts to ensure proportional staffing levels.
The company believes having excess employees can lead to inefficiency, coordination costs, and investments in lower-return activities.
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Shah said: “I believe we need to stay focused as a company on what committed small teams can accomplish.
“In many ways, having too many great people is worse than having too few.”
“With too few, you get a lot done quickly, but you may not get everything done that you want.
“But having too many causes inefficiency, coordination costs, and investments in lower return activities.
“That is what we have been experiencing and what we need to end.”
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