The pain from pullbacks in retail and ecommerce spending is being felt across the board in logistics, delivery and shipping operations, both internal and external, with layoffs announced at a number of companies scrambling to resize staff in line with lowered demand.
From Walmart to 3PLs, trucking and supply chain and even robotics firms, reports of headcounts being trimmed continue to pour in.
Last week, Walmart raised alarm bells when pink slips went out to hundreds of workers at fulfillment centers in New Jersey, Texas, Florida, California and Pennsylvania, according to various media reports.
This was on top of nearly 1,500 laid off at a Walmart fulfillment center in Atlanta last fall. That, however, was to shift the facility to automated fulfillment of marketplace orders, using Alert Innovation bots run by engineers and data scientists.
In February, ecommerce furniture seller Wayfair canceled its plans to build a $133 million distribution center in north Houston, in the face of declining sales, according to a report in the Houston Chronicle. For the fourth quarter, Wayfair posted net revenue of $3.1 billion, down 4.6% from last year, while adjusted EBITDA was a $71 million loss vs. a $4 million loss in 2021.
On the shipping and delivery front, Penske is laying off 152 workers in Fort Worth, TX, after the company lost a contract with Kroger, according to the Dallas Morning News. Meanwhile, once high-flying delivery startup Gopuff last week announced a 2% reduction in its workforce, the Philly Voice reported. Last year, hundreds of workers were laid off and warehouses were closed in a downsizing.
UPS told members of the Teamsters union during contract negotiations last month it was laying off some part-time weekend drivers, known as 22.4 workers, Business Insider reported. UPS called it a flex reassignment to meet shifting demand. FedEx, for its part, has put drivers on furlough in its Freight division, in addition to a 10% reduction in corporate staff.
Supply chain and logistics firms like Flexport, C.H. Robinson, OA Logistics and others have either instituted layoffs or signaled their intention to do so this year.
“As transportation industry layoffs continue to set supply chain professionals on edge, shippers are searching for new strategies to bolster resiliency and efficiency in parcel operations without increasing overhead costs,” wrote shipping analytics and consulting firm Intelligent Audit in a blog post. “For many parcel shippers, the new, bare-bones structure at legacy carriers like FedEx will require a new emphasis on streamlined parcel management and greater reliance on regional and alternative carrier options.”
Warehouse robotics vendors, which have grown in number and size over the past five years as demand exploded, have not been spared from cutbacks. In late January, IAM Robotics announced layoffs reportedly touching 65% of its workforce, according to PittsburghINNO, and PlusOne Robotics cut 10% of its staff in San Antonio, the San Antonio Express-News reported. Earlier this month, PlusOne announced a $50 million raise and the addition of Pitney Bowes to a client list that also includes FedEx and DHL.