Wayfair Inc., a Boston-based e-commerce company that sells furniture internationally, announced on Friday that as part of a cost-saving plan it will cut 1,750 jobs, representing 10 percent of its entire global workforce.
In a statement on Jan. 20, the furniture retailer said the layoffs will include approximately 1,200 employees on the corporate team, which the company is decreasing by 18 percent.
Wayfair outlined a $1.4 billion cost-saving plan in August 2022 as it seeks to scale down on operating costs amid weakening demand for its furnishings and consumers cutting back sharply on retail spending.
The latest changes will save the company about $750 million annually, putting the business a little over halfway to its cost-saving goal, Wayfair said. “These changes reflect efforts to eliminate management layers and reorganize to be more agile,” the company stated.
Niraj Shah, Wayfair’s co-founder and chief executive officer, told employees in an email that the move is important for the company’s future and will strengthen the business “without reducing our total addressable market, our strategic objectives, or our ability to deliver them over time.”
“Although difficult, these are important decisions to get back to our 20-year roots as a focused, lean company premised on high ambitions and great execution,” Shah said.
“In hindsight, similar to our technology peers, we scaled our spend too quickly over the last few years,” he added, noting that he’s “deeply saddened” about the layoffs.
“To our colleagues departing Wayfair, I want to thank you for your contributions to the company and for the impact you’ve had on the business,” the CEO concluded.
Wayfair had 16,681 full-time equivalent employees as of Dec. 31, 2021, according to a regulatory filing.
The layoffs are being announced as the U.S. government reported on Wednesday that retail sales fell in December, marking the second consecutive monthly decline and the biggest monthly drop for 2022.
Companies Announcing Major Layoffs
The online retailer joins a growing list of companies, including tech giants Microsoft Corp. and Google parent Alphabet Inc., which have slashed their workforce this week to rein in costs to ride out of the economic downturn.
In a note to employees on Jan. 18, Microsoft CEO Satya Nadella said the company will cut 10,000 jobs in response to decreasing demand after the COVID-19 pandemic.
Alphabet CEO Sundar Pichai, meanwhile, announced in a note to employees on Jan. 20 that 12,000 jobs will be eliminated as a response to economic changes over the past two years.
Earlier this month, two other major companies said that thousands of jobs will be cut amid concerns about an economic slowdown.
Amazon informed staff on Jan. 4 that it will be cutting about 18,000 positions. It’s the largest set of layoffs in the history of the Seattle-based company, although just a fraction of its global workforce of 1.5 million.
The workforce eliminations are focused on the company’s devices and books business, as well as its people, experience, and technology organization, and Amazon stores.
Facebook parent Meta said in early January that it would cut 13 percent of its workforce—or more than 11,000 employees. The layoffs are among the biggest tech job cuts this year as the company grapples with a weak advertising market and mounting costs.
Reuters contributed to this report.