Key Insights:
- ZOE is reducing its operational costs by 20% to align its expenses with revenue and member base growth, which has not met the forecasts for 2024.
- As a consequence of the cost cuts, ZOE is considering reducing its workforce. This decision follows a period of rapid expansion, where the company grew significantly in response to high demand but now finds the expansion unsustainable without a larger member base.
- Along with workforce reductions, ZOE is halting its search for a new London office, not upgrading its US warehouse, and significantly reducing contract costs. The majority of the company’s expenses are tied to employee salaries, indicating deep cuts in these areas.
- ZOE plans to support departing employees with compensation packages, extended healthcare coverage, the option to retain work laptops, and career support to assist them in finding new roles.