New York - The saga of layoffs continues after US-based online furniture company Wayfairl laid off 1,650 employees which amounts to 13% of its total workforce. On Friday, the company's CEO Niraj Shah wrote an open letter on the matter and mentioned that the company “went overboard” in hiring during a “strong economic period”. Shah was referencing the 2020 era when online shopping witnessed a “dramatic surge” which eventually doubled Wayfair’s sales to $18 billion. This is the third round of layoffs the company has conducted in the last 18 months as it seeks to cut costs and boost its financial results. 

“I want to say thank you to the 1,650 team members who will be leaving us today. You are all valued and talented individuals, and you have each made incredible contributions to Wayfair and our customers. We know you will land in great roles given your strong skills and expansive experience, but this is still sad for everyone. You have so much to be proud of, and I truly regret the impact this will have on you,” Shah wrote in the letter which was shared with the staff on Friday. I think the reality is that we went overboard in hiring during a strong economic period and veered away from our core principles, and while we have come quite far back to them, we are not quite there. The best way to make sure everyone in the company can thrive and that we can do the most for our customers is to make sure that we make the right decision in terms of what our go-forward organization should look like. “I think the reality is that we went overboard in hiring during a strong economic period and veered away from our core principles, and while we have come quite far back to them, we are not quite there. The best way to make sure everyone in the company can thrive and that we can do the most for our customers is to make sure that we make the right decision in terms of what our go-forward organization should look like,” the CEO furthered. In the span of a few months, tech giants like Google, Amazon and Flipkart have managed to fire a massive chunk of its workforce. 

The restructuring will save the company $280 million

According to CBS News, the restring of the company is expected to save the Boston-based retailer roughly $280 million. Not only this but shortly after the open letter was released, Wayfair's stock price jumped 15% in pre-market trading. As per the reports, nearly 20% of the layoffs will be done on the corporate team. If last year's data are to be believed, the Boston-based company had about 14,000 employees. While elucidating on what went wrong, Shah noted that the company faced a drop after the COVID-19 lockdowns were lifted all around the world. “By mid-2022 it was clear we were in a bust period. It was also clear that we had gone overboard with corporate hiring during COVID-19. As everyone here knows, we’ve had two significant corporate restructurings since 2022 to try to right-size this. Each time we used our best judgment, identified the cost target we needed to hit, and believed we were resizing to the right point,” Shah averred. "I believe we need to stay focused as a company on what committed small teams can accomplish. In many ways, having too many great people is worse than having too few," he averred.