Retailing has always been a tough business and it's becoming increasingly so for those workers not high enough up on the management ladder to determine who stays employed and who gets the pink slip.
Just yesterday, Home Depot was the latest chain to announce a massive layoff with nearly 7,000, roughly two percent of its workforce, joining a growing list of former retail workers. Corporate suite employers did not come out of the cut unscathed with up to 15 people, approximately 10 percent of the company's corporate officers, also being given notice.
The home improvement retailer decided to close its 34 Expo Design Centers along with five others in California operating under the YardBirds' banner.
"Exiting our EXPO business is a difficult decision, particularly given the hard work and dedication of our associates in that business and the support of our loyal customers," chairman and chief executive Frank Blake said in a statement. "At the same time, it is a necessary decision that will strengthen our core Home Depot business."
According to Mr. Blake, Expo never reached its goals even during the housing boom that preceded the current bust. In 2008, the business lost $50 million and this year the loss was expected to reach $80 million.
David Schick, managing director at Stifel Nicolaus, praised Home Depot for its "rational" response to the realities of the marketplace. "We want to look at companies admitting how bad things are instead of not looking at it," he told The Atlanta Journal-Constitution.
Discussion Questions: What do you think of Home Depot's decision to cut staff and close Expo and Yardbirds? Was this essentially due to a failing of the Expo concept? Are there steps short of layoffs that retailers could be taking now to protect their business or have large job cuts and store closings become the only rational approach to the challenges posed by current marketplace conditions?