REI Lays Off 357, CEO Forecasts Down Year
REI Co-op announced layoffs for hundreds of employees on Thursday, with CEO Eric Artz warning of a “very challenging” 2024 and citing a “highly promotional” environment.
The Seattle-based outdoor specialty retailer is cutting 357 workers, including 200 at headquarters, six in sales and customer support, 30 in its experiences department, and 121 in its distribution centers. The cuts make up 2.2% of REI’s total workforce.
Store-specific roles are not impacted, according to the company.
In a letter to all employees, Artz said the layoffs were “primarily driven by financial necessity.”
“We took a strategic approach to evaluating team structures against business needs to ensure consistency across the organization as leaders made decisions about which roles to eliminate,” he wrote.
In citing the challenging and highly promotional environment, Artz said while the U.S. as a whole has avoided entering a recession, outdoor specialty retail has experienced four quarters of decline, “and that trend has been worsening.”
“While we were able to outperform this trend for much of the last year, it caught up to us in Q4 and we now expect conditions to remain very challenging throughout 2024,” he added.
As a result, REI is expecting 2024 revenue to be down from 2023.
“When we plan our revenues down, we must adjust our plans and cost structure accordingly,” Artz said. “We must also continue our work to return REI to profitability to set the co-op up for long-term health and success.”
In October last year, REI laid off about 275 store workers, cutting its sales lead role across all retail operations. That was after cutting about 8% of its headquarters staff, or 167 workers, in February.
Artz said the company will share an overview of its go-forward plan next week, including major updates to work and projects.
Bart Schaneman can be reached at firstname.lastname@example.org.