Flexport has announced it is laying off 600 workers as the logistics startup deals with slow demand in shipping.
The cuts affect 20 percent of its employees and will be made at offices across the world.
The company will reposition its operations to provide more supply-chain services as part of the restructuring.
Co-CEOs Ryan Petersen and Dave Clark made the layoff announcement on Wednesday, January 11.
A statement said: “We are overall in a good position, but are not immune to the macroeconomic downturn that has impacted businesses around the world.
“Lower volumes, combined with improved efficiencies as a result of new organizational and operational structures, means we are overstaffed in a variety of roles across the company.”
Flexport said that it will continue to recruit in specific business units, including hiring 350 to 400 software engineers, with the aim of doubling that division.
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The San Francisco-based firm got $935 million in a funding round nearly a year ago, valuing it at $8 billion.
It employs over 3,200 people worldwide, spread across 19 offices and six warehouses.
In the memo, the company said it has reduced its volume forecasts through 2023 but didn’t provide specifics.
The reductions come amid a larger drop in freight demand that began in the middle of last year.
It is because inflation has affected consumer demand and retailers have withdrawn from earlier inventory restocking efforts.
Source: The Wall Street Journal