Blue Apron is approaching their next earnings report in the next few weeks; the company said Wednesday they plan on laying off 6% of their staff as part of “a company-wide realignment of personnel to support its strategic priorities.”
Blue Apron was one of the most highly anticipated IPOs of the year. But since going public, Wall Street has cut Blue Apron’s stock price in half, and it has been unable to rise since then. The company is an example of a business that faces significant challenges that include acquiring and retaining customers as well as a competing with the e-commerce giant, Amazon.
These layoffs hit the company’s corporate offices and fulfillment centers. Blue Apron said it had 5,393 employees on June 30 this year, which means over 200 people will be laid off.
“A company-wide realignment, like the one we announced, is always painful, and especially so for a close-knit team like ours,” CEO Matt Salzberg said in a note to employees. “Our leadership and Board did not take this decision lightly, and I want to assure you that we believe it was necessary as we focus the company on future growth and achieving profitability. The actions that we took today flowed from the roadmapping (sic) and reprioritization exercise that we recently undertook. As part of that work, we identified the need to reduce some roles, open others, and streamline decision making for greater accountability. Wherever possible, we sought to fill new roles with existing employees.”
For Blue Apron to stay competitive, it is common for a company to go through a round of layoffs. That said, Blue Apron will have to find a new business strategy that will convince investors that it should remain an independent company that can continue to scale. Not to mention, one of Blue Apron’s competitors HelloFresh is also planning on going public.