Lucas Jackson/Reuters
- Wayfair's leaders say several recent rounds of layoffs have made the company better and better.
- In January, the home goods company laid off 13% of its workforce, affecting 1,650 employees.
- The leaders say the smaller staff has helped the company get more done faster — and cheaper.
Laying off workers over and over is working out great for Wayfair, according to the company's leaders.
On Thursday, Wayfair CEO Niraj Shah wrote in a letter to shareholders — co-signed by co-founder and co-chairman Steve Conine — that several rounds of layoffs over the last year-and-a-half have helped the company become leaner and meaner.
"While it is early, it does seem like we are getting more done, and faster, and at a lower cost," Shah and Conine wrote in the letter. "It also feels like we have the right level leaders in charge of the right things."
Wayfair's most recent round of job cuts came in January with the elimination of 13% of its global workforce, or about 1,650 workers. That announcement came just weeks after Shah said in a companywide email that Wayfair was "back to winning," while also urging staff to be more frugal and work longer hours.
Wayfair also laid off 1,750 employees in January 2023 and 870 employees in August 2022, Business Insider previously reported.
Shah and Conine said all the layoffs compounded to make the company better.
"We decided to reduce the size of our team in the summer of 2022," Shah and Conine wrote in the letter. "Soon thereafter, we discovered we were getting more done, and it was getting done faster and at a lower cost. This led to the realization that we had only scratched the surface of our efficiency gains, and in Jan 2023 we further reduced the size of our team."
"Yet again we found the same thing - getting more done, and faster, at a lower cost," they continued. "Unfortunately yet again it became clear that we had not yet gotten back to where we needed to be. And so this time we did things differently - we did a white sheet org model exercise and rebuilt the org from the ground up. This led to a reduction in Jan 2024 but one rooted in our core principles of organizational design."
Shah and Conine's letter accompanied Wayfair's earnings report on the fourth quarter and full year of 2023.
In Q4, Wayfair's net revenue increased to $3.1 billion, up 0.4% year-over-year, according to the company's statement. Despite Q4's gains, Wayfair's net revenue for the entire year was down 1.8% year over year.
Shah praised the Q4 results as a "definitive step on our profitability journey and a reflection of the immense progress we achieved throughout the entire year."