Wayfair are the latest to lay off a significant number of staff as the economy slows and the pandemic boost to ecommerce evaporates. This comes after the furniture and home retailer and marketplace’s Q2 results were announced earlier in the month with revenue down almost 15%.
Having seen the tailwinds of the pandemic accelerate the adoption of ecommerce shopping, that growth was not sustained and the Wayfair team is too large for the environment we are now in which has led to the adjustment in staffing requirements for a profitable sustainable future.
Over the past few years, we’ve grown Wayfair significantly to keep pace with the ecommerce growth in the home category. We were seeing the tailwinds of the pandemic accelerate the adoption of ecommerce shopping, and I personally pushed hard to hire a strong team to support that growth. This year, that growth has not materialized as we had anticipated. Our team is too large for the environment we are now in, and unfortunately we need to adjust.– Niraj Shah, CEO, Wayfair
This is desperately sad for those who have lost their jobs, but is the inevitable consequence for those that expanded rapidly as the pandemic boosted ecommerce and then hit a brick wall with the reopening of physical retail coupled with soaring inflation. It’s easy to blame the Russian war in Ukraine with soaring gas and oil prices but there is also a post-pandemic bill to pay and consumer spending is going to be severely constrained for some time to come. Shopify also found themselves in the same position as Wayfair.
We’re hearing rumours of a number of businesses in trouble – Businesses best placed to move forward will be those who relied on existing staff and investment to maximise on pandemic sales. Those worst placed will be businesses who rapidly expanded warehouse space and recruited to run the facilities and are now seeing the pandemic boost dissolve away.
Wayfair will lose nearly 900 staff, with a thinning out of management layers to enable team members to focus on execution, aligning our work with strategic priorities, and adjusting areas that have simply grown faster than our current revenue trajectory can support.