Online retail giant Buy.com Wednesday announced it will cut its workforce across the board by almost half and significantly reduce outsourcing services as part of a major restructuring plan designed to reduce cash operating expenses.
Earlier this month, Buy.com, the US's second-largest online retailer, said it would slash about 10 per cent of its workforce after missing its fourth-quarter earnings estimates. Twelve days later, the company announced the resignations of its CEO and chief financial officer.
Yesterday, the company said it will cut 125 of 256 positions as part of a plan to reduce cash expenses by about $US29 million annually and that, "when coupled with other actions already under way", total annual operating expenses would decrease by $70 million over last year.
A Buy.com spokeswoman said the company will also stop outsourcing its customer support services as part of the cost-saving measures.
Buy.com said it expects a pretax charge of $32 million to $37 million in the first quarter of this year that is associated with its restructuring plan. The company also said it would exit "the golf business acquired from buygolf.com" and close the company's sports store.
Board member James Roszak, who was appointed interim CEO two weeks ago, said the latest cost-cutting measures were needed to streamline operations and "advance our goal of becoming profitable while maintaining a leadership position in e-commerce."