The US online retailer for curated shopping, Stitch Fix, has parted ways with its CEO Elizabeth Spaulding. In the meantime, founder Katrina Lake will take over her role and lead the search process until a successor is found. The company announced this in a message to its employees, which was published on its blog.
“Elizabeth and the board [haben] made the difficult decision to step down as CEO to make room for a new leader. I am grateful for the many contributions Elizabeth has made as President and then as CEO, and I am grateful for her leadership at a time that has been unprecedented for our company and the world,” Lake said in Thursday’s statement.
It also announced that Stitch Fix would reduce its workforce by a fifth of its current workforce of approximately 1,700 and close its Salt Lake City distribution center. During the transition phase, employees leaving the company received their salary for at least 12 weeks, which increased as they worked for the company.
A fifth of the employees have to go
In addition, affected employees still have health insurance until April 2023 and will receive support for mental well-being until the end of April 2023, which also includes advice, self-help tools, legal and financial services and online advice on reconciling work and private life. Departing employees are also supported in their job search.
“Despite the difficult situation we are in right now, the Board and I remain strong believers in Stitch Fix’s business, mission and vision. We know this company has a great future because of the hard work and foundation this team has laid, and we are committed to getting the company there,” concluded Lake.
Nearly a year and a half ago, Lake had stepped down from her position as Stitch Fix CEO to focus on the company’s social impact efforts, specifically the intersection of sustainability and technology in apparel retail.
Founded in 2010 and going public in 2017, the company has benefited from increased activity during the pandemic as consumers took advantage of work-from-home offerings like Stitch Fix’s. After lockdowns were lifted and customers started visiting the stationary trade again, the company was unable to stop falling sales and had to lay off 330 employees in June last year.