DoorDash has announced to eliminate more than 1,200 corporate jobs. The company stated that they over-hired during the COVID-19 pandemic when demand for its services rose rapidly. Moreover, food ordering company DoorDash has become the latest tech company to announce job cuts in recent weeks. DoorDash CEO termed this as one of the most difficult decision in company’s almost 10-year history.
Ways to reduce operating cost
DoorDash is an American company and they operate a food ordering and food deliver platform. The company is based in California and has a vast operational network. The company grew during the pandemic era and hired massively in wake of rising demand during that period. However, with the ease in lockdown restrictions and consumers turning back to restaurants and other food chains, the demand for its services is now on a decline. The company is now looking for ways to reduce its operating expenditures. However, they have come up with the decision to cut jobs as a final resort to manage its growing expenses.
DoorDash CEO issued a message to his employees and stated that the company hired massively to grow and remain competitive. However, DoorDash is now planning to cut approximately 1,250 jobs. “Most of our investments are paying off, and while we’ve always been disciplined in how we have managed our business and operational metrics, we were not as rigorous as we should have been in managing our team growth. That’s on me. As a result, operating expenses grew quickly.” DoorDash CEO Tony Xu said in a statement confirming the job cuts. In addition, the CEO announced that they will keep on looking for other ways to reduce operating costs. But these measures may not be enough to close the existing expense gap and job cuts were inevitable. “This hard reality ultimately led me to make this painful decision to reduce our team size.” Tony Xu further added to his statement.
Moreover, the affected employees will receive 17 weeks of compensation and their February 2023 stock vest.
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