Dive Brief:
- Patagonia has laid off 41 people following a business restructuring at the company’s Ventura, California headquarters, CEO Ryan Gellert said in a Monday post on LinkedIn. Those leaving represent about 1% of the company’s workforce, Patagonia said.
- As part of the restructuring, some new roles were created and filled by current employees. Many corporate roles evolved and some positions were eliminated, Gellert said. Going forward, the company said it will focus most of its teams on three functions — product, storytelling and impact.
- Although Patagonia is profitable, and the company is “getting more right than wrong,” changes were necessary because the outdoor apparel and gear retailer’s business is “vulnerable to the same economic headwinds many companies in our industry are facing,” the CEO said.
Dive Insight:
This week’s layoffs are the second round of job cuts at Patagonia this year.
In June, the company told 90 of its remotely-based customer service workers that they could either relocate to within 60 miles of one of seven metro areas or they’d be let go and receive a severance package. A Patagonia spokesperson said most of those affected declined to move, according to media reports.
Patagonia isn’t alone in citing macroeconomic issues as a contributing factor in recent job cuts. In January, REI, another outdoor specialty retailer, laid off 357 people across the company, including 200 at its Washington state-based corporate headquarters. And in August, the company confirmed it laid off an additional seven people. Other retailers with confirmed corporate layoffs this year include CVS, Walmart, Purple and Dollar Tree.
Gellert said this week’s announcement of restructuring, job changes and job cuts “does not represent a failure of people or roles. It means some parts of our company need to be shaped differently from the setup that made us successful in the past.” Patagonia did not immediately respond to questions from Retail Dive regarding what specific roles or positions were created or eliminated as a result of the restructuring.
“We are evolving key functions in our Ventura headquarters to re-focus on building the best product, creating authentic connections through storytelling, and generating even more impact through grassroots environmental partnerships and responsible business practices,” said Gellert, who has been with the company for 10 years, the last four as CEO.
The company said those affected by Monday’s layoff announcement were informed through individual conversations. They will receive a minimum of 22 weeks of pay that increases with their tenure at the company. Those being let go will also receive financial support to cover one year of health insurance costs and career transition assistance, Gellert said.
Before this year’s job cuts, one of Patagonia’s most recent and significant business changes was in 2022, when the retailer announced that its founder, Yvon Chouinard and his family, transferred ownership of the company to two entities — the Patagonia Purpose Trust and the Holdfast Collective. The company at the time characterized the move as making “Earth” the only shareholder. Patagonia said earnings that are not reinvested in the company will be committed to protect the environment. At that time, the privately held company said that decision would amount to about $100 million annually.
