Bloomberg reports that "Gopuff has fired hundreds of staff members, coming after earlier rounds of job cuts this year, as the rapid delivery startup struggles to stem its cash burn in a slowing economy … the job reductions primarily affected customer service staff, which included a mix of full-time and temporary employees."
Sources tell Bloomberg that about 250 people have been laid off. Gopuff had about 15,000 employees earlier this year.
The story notes that "closely held Gopuff is navigating an uncertain economic environment while facing increasing competition from rivals like DoorDash Inc. In March, the company laid off 3% of its global workforce and further reduced headcount in July, letting go of about 1,500 people. Over the summer, Gopuff also shuttered 76 warehouses, roughly 12% of its network, across the US to consolidate its footprint in some cities."
Gopuff said that the new layoffs were part of a "planned" downsizing, and that “there are no plans for incremental layoffs.”
Reuters reports that "some employees who were let go described the firings as chaotic and said they weren’t given a warning before access to internal systems like Slack, email, and human resources portals were revoked, even as they were still working shifts. Other full-time employees were told severance packages were 'coming soon'."
- KC's View:
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"No plans for incremental layoffs?"
Just curious. Does anyone really believe that?
I hear comments like that, and I think back to the days when I was a young writer working in the video division of the company that then owned Progressive Grocer. And every time senior executives had to lay people off, they'd call together the survivors and say that layoffs were coming to en end, and that we were turning the corner. It didn't take many repeat performances before we all knew when these guys were lying to us - their lips were moving. (In the end, I'm grateful - I was eventually laid off, which started me on the path that led here.)
Gopuff is part of a broad reset taking place after the pandemic boom, as inflation and a likely recession forces the delivery industry to rightsize. It'll be painful for some, fatal for others. Think of it as the circle of life.
Maybe "rightsizing" needs to be a daily discipline, not an emergency measure.
Scott Galloway said the other day that the best way to define "recession" is as something that happens every seven years … and it has been 13 years since we've had one.
