Wayfair UK profits dip in FY23 despite cutting workforce by third
The profit loss comes despite the group axing 31% of its workforce, with the average number of employees in the UK falling to 587, down from 847 the prior year
The UK arm of Wayfair has seen profits dip in its full-year results, despite cost-cutting plans that included reducing its workforce, newly filed documents have shown.In the year ended 31 December 2023, profit-before-tax fell by 3% to £2.64m, down from £2.73m the prior year. In addition, sales fell by 17% to £69m over the period, largely driven by administrative expenses over the period.
The profit loss comes despite the group axing 31% of its workforce, with the average number of employees in the UK falling to 587, down from 847 the prior year.
Earlier this year, Wayfair unveiled plans to axe around 1,650 global roles after a “comprehensive, organisation-wide analysis of the appropriate team size and structure”, representing around 13% of its global workforce and 19% of its corporate team.
At the time, CEO and co-founder Niraj Shah said: “Earlier today I sent a note to all Wayfair employees detailing today’s action and the rationale behind it, which is available for everyone to read on our company site.
“The changes announced today reflect a return to our core principles on resource allocation, such as getting fit on spans and layers as well as focusing on our highest priorities. As a result, we’re reducing team sizes across the organisation, as well as reducing seniority in certain roles that we plan to rebuild with modified levelling over the course of this year.”
In its latest filings with Companies House, Wayfair UK said: “The strategy of the company is to maintain its warehouse and fulfillment services operations in the UK to drive Wayfair Stores Limited’s European growth.
“This will increase the underlying operating expenses, while also increasing revenue and operating profit in the coming years.”
It added that the “risk that anticipated growth within European economies continues to be negatively impacted by uncertainty in Europe, particularly due to the ongoing situation in Ukraine and the cost of living”.
It added: “The risk is mitigated through the combination of a competitive pricing structure, extensive affordable brand selection and high service levels to our customers. There is a particularly strong emphasis on achieving and maintaining high levels of customer services which distinguishes the company from its competitors.”
