Reusable shopping bag with logo at Whole Foods Market grocery store in Dublin, California.
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Amazon’s Whole Foods is laying off some company employees as part of a planned reorganization of select teams, and as its parent company closely examines the costs.
Whole Foods plans to reorganize several global and regional support teams over the next two months, the company’s executive team wrote in a memo to employees Thursday. As a result, the upscale grocer is laying off several hundred employees from those groups, a spokeswoman confirmed. The cuts translate to roughly less than half of one percent of the company’s global workforce, a Whole Foods Market spokeswoman said.
“We often talk about how simplifying our work and improving how we operate is critical as we grow,” the executive team wrote in the memo. “We have made great progress in these areas through recent operational and organizational changes. As the grocery industry continues to rapidly evolve, and as we – like all retailers – have -navigating challenges such as the COVID-19 pandemic and continued economic uncertainty, it has become clear that we need to continue building on these changes. With additional adjustments, we will be able to further simplify our operations , make processes easier, and improve how we support our stores.”
As part of the changes, Whole Foods, which operates in nine different regions, will move to six regions. The move will not result in any store closings or layoffs for any store or distribution center employees, according to the memo.
Whole Foods is restructuring its operating structure as it seeks to expand and better serve customers, the spokeswoman said. The company has around 50 new stores in development, they added.
Amazon in 2017 spent $13.7 billion to acquire the upscale grocer, a move that sent shock waves through that industry. The retail giant acquired Whole Foods with hopes of accelerating its multiyear push to sell groceries online and in physical stores.
Whole Foods has undergone other operational changes since its acquisition by Amazon. The company in 2021 merged its global and regional merchandising teams, and shifted its technology team to focus on software engineering, technical product and program manager roles, to “sustain our growth.”
Amazon CEO Andy Jassy recently paused the expansion of its Fresh supermarket chain amid a company-wide effort to rein in costs. It also closed some Fresh locations and Go cashierless convenience stores. Some employees in Amazon’s grocery unit were let go in a recent round of layoffs announced in January.
Still, Jassy said he remains confident in Amazon’s potential to grow its grocery business. In his letter to shareholders last week, Jassy said the e-commerce giant “must find a mass grocery format that we think is worth massive expansion” to make a bigger impact on brick-and-mortar grocery .
Here’s the full memo:
Improving Our Operating Structure to Better Support Our Stores
Dear Team Members,
We often talk about how important it is to simplify our work and improve how we operate as we grow. We have made good progress in these areas through recent operational and organizational changes. As the grocery industry continues to rapidly evolve, and as we — like all retailers — go through challenges like the COVID-19 pandemic and continued economic uncertainty, it’s become clear that we need to continue to build these changes. With additional adjustments, we will be able to further simplify our operations, make processes easier, and improve how we support our stores.
To achieve this, we will be changing our operational structure and making some changes to some Global and Regional Support teams over the next two months. We see a great opportunity to advance our impact on the world, and these changes will help us take full advantage of that opportunity. These changes include:
- Moving from nine to six regions with a more consistent number of stores in each region. Moving to fewer regions of similar size will allow us to make decisions quickly, implement sustainable processes, and measure changes. Ultimately, this will help us elevate the service we provide to our customers, Team Members, and suppliers. As we redraw the lines of our regional map, some stores may become part of the new region, but this change will not result in any store or facility closings or change our commitment to maintaining a local connection to our store. Check out our new region map and leadership details below. Team Members can expect to hear from their future region leader early next week.
- Creating a unified Operations team across the company by moving category-specific store operations support from the regions to a single Field Support team within our Global Operations team. In addition, we will decentralize supply chain management work from the regions, transferring these responsibilities to a new Supply Chain Performance Management function within our Global Supply Chain team. These changes will free up time for stores to focus on serving customers, while consolidating communications and support with clear Operations priorities.
- Improving Team Member Services (TMS) support for Team Members and Leaders across the company by realigning TMS group structures. This will help eliminate a significant amount of transactional work, allowing our TMS teams to focus more on supporting Team Member experience, growth, and development. It will also empower store leadership to operate with greater agility and have more time to focus on priority initiatives.
- Restructuring and improving processes of several other Global Support teams to provide more effective, timely, and consistent support to stores and ensure support teams can focus on priority initiatives. We will begin sharing more information about the Global Support team’s changes with their respective teams today. We will also be meeting with store and facility management to discuss these updates in more detail.
These changes will affect our Team Members in different ways. Store and facility-based roles are not directly affected, although there will be some adjustments to how support and store teams work together. There will be some headcount reductions in certain Global and Regional support teams, and those affected will receive more information today. While change is necessary and healthy for a sustainable business, it can also be very difficult, especially when it affects the lives of Team Members. We are committed to supporting all affected Team Members through these changes.
As we simplify processes and improve how we operate, we’ll be able to respond quickly to evolving business needs, better focus on our most effective work, and invest in new ways to serve all stakeholders. We are confident that these changes will allow us to better support our stores, Team Members, and suppliers, elevate the customer experience, and position Whole Foods Market for continued growth. . Most importantly, these changes will help ensure we deliver on our Purpose to feed people and the planet for decades to come.
Sincerely, E-Team
WATCH: How Whole Foods has changed since Amazon took over
