It seems that Ms. Lake’s “high empathy model” which she claims to be “really, really valuable” doesn’t apply to the 1,400 California workers she’s about to lay off. Furthermore, what Lake and her leadership team seem to be discounting is the California-style sensibility these stylists bring to the service. With all due respect, stylists in Cleveland or Pittsburgh may be lower cost and fine stylists, but they don’t have a California sensibility.

As a Californian working for an Atlanta-based company, this story hits close to home. The cost of living in this beautiful state is indeed high, no doubt, and wages are definitely higher. However, I believe market forces will determine if Facebook’s decision to pay people less if they move out of state is feasible. As for Stitch Fix, there is a very practical challenge they will face by abandoning California-based stylists: moving all their stylists out of state will reduce their ability to stay close to the lifestyle and fashion trends of more than 40 million consumers. Heck, just losing feet-on-the-street visibility to the choices made by 12 million Los Angelinos will compromise their stylists’ value proposition. Even though I fear I may have some bias, I am not sure this move will pay dividends.

While I understand the desire to lower their labor cost, I believe a more rational approach would be to mix in some stylists from the identified markets and monitor the results. A small decrease in the number of stylists based in CA would not shock the system.

Stitch Fix seems to care more for lowering labor costs than focusing on driving customer satisfaction and increasing purchases-per-customer. By treating employees as interchangeable units of human capital, Stitch Fix, like Facebook (which is in a category by itself due to recent actions by Mark Zuckerberg), is in danger of damaging its reputation and weakening engagement with its customers.

Stitch Fix is a retailer of basics for “everyone” as their tag line reminds shoppers. While it’s plausible the “higher touch, high empathy model is really, really valuable” argument can be true, laying off 1,400 California-based personal stylists indicates other internal challenges within Stitch Fix. We have all witnessed the slow-motion rise and demise of dozens of big-name apparel brands over the years. The fall usually begins with the cost-cutting of the pillars of the brand. Macy’s, J.C. Penney and others are current examples. Laying off 18 percent of the California Stitch Fix stylist workforce to hire 2,000 stylists in Cleveland, Pittsburgh, and Dallas as a cost-cutting measure seems to this outsider as a signal of internal challenges facing the Stitch Fix business model. Lost in translation will be the Stitch Fix brand. Such a move is curious. Possibly Stitch Fix has gone beyond its peak and now faces the same issues brick and mortar stores like Gap, retailer of high priced basics, are facing.

First, I wanted to share an article I wrote about my “Stitch Fix Experience.” I believe it nicely sets the stage for this discussion.

Next, to Tom’s question, I think Stitch Fix’s shift to employ lower cost stylists is prudent and good business. Ensuring that these workers have the credentials to do the job, location should not matter. And, given the need for cost-containment across the entire supply chain (especially in retail-oriented industries) and the growing desire for “work from home” talent, timing is ideal to shift to this new model.