Blue Apron Announces Restructuring Strategy; Will Cut Workforce by 4%
NEW YORK, NY - Blue Apron is taking the new year, new you philosophy to heart. In a bid to to accelerate its path to profitability, the meal kit company has released its plans to restructure its business in 2019.
“The ways in which consumers access meals for various occasions has evolved rapidly with expanded choice and the continued convergence of online platforms and brick and mortar stores,” said Brad Dickerson, CEO, in a company press release. “Blue Apron has an established brand and a strong foundation of loyal customers who trust and rely on the quality and convenience of our products. We are taking decisive actions to prioritize our highest-impact opportunities and build a stronger, sustainable business. As a result of these actions now underway, we expect to be profitable on an adjusted EBITDA basis in 2019. This included the difficult decision to part ways with valued employees. On behalf of the entire company, I thank these colleagues for their many contributions to the business.”
The press release noted these immediate organization-wide actions in its restructuring vision:
- Sharpening focus on direct-to-consumer business by prioritizing customer segments with proven affinity and retention, as well as attracting consumers with similar attributes
- Methodically expanding consumer reach through retail channels and on-demand platforms
- Streamlining personnel to create a more agile and focused organization, resulting in a headcount reduction of 4% of total workforce
- Further optimizing fulfillment center network to build on momentum of recently achieved operational efficiencies
The news of this plan broke the same day the company announced its third quarter report. Highlights of the report included:
- Net revenue decreased 28% year-over-year to $150.6 million in the third quarter of 2018, compared to the third quarter of 2017
- Net loss was $33.9 million in the third quarter of 2018 compared to a net loss of $87.2 million in the third quarter of 2017
- Adjusted EBITDA improved 61% year-over-year to a loss of $18.8 million in the third quarter of 2018, compared to a loss of $48.0 million in the third quarter of 2017
Will this restructuring give Blue Apron a fresh start? AndNowUKnow will keep you up to date.
