Luxury resale platform The RealReal is set to cut 7 percent of its staff in a bid to slash costs across the business.
The move will impact around 230 employees at the company, a filing with the Securities and Exchange Commission stated.
It comes as a U-turn to the firm’s previous strategy of bulking up its staff, a move it initiated last year in preparation for what its executives told analysts was an expected late-pandemic surge.
Now, the tech company is looking to reduce its operating expenses through layoffs as well as store closures.
The decision will cost between 1.7 million dollars to 2.2 million dollars for severance pay, employee benefits and other related expenses.
The RealReal will close two of its flagship stores in San Francisco and Chicago, two neighbourhood stores in Atlanta and Austin and two luxury consignment offices in Miami and Washington, as well as any co-located logistics hubs.
It is further planning to reduce its office spaces in California, San Francisco and New York.
It added that it would continue to evaluate its real estate presence where appropriate while assessing trends in the marketplace and macroeconomic factors.
The announcement comes less than a month after the retailer appointed John Koryl as its new CEO, tasking him with streamlining the company’s operations and leading it towards profitability.