Following on from the recent announcement that its Sacramento operations would be closing, grocery e-tailer Webvan today unveiled a set of major restructure plans; a bid to keep the flagging company afloat as cash resources dwindle.
Go deeper with GlobalData
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
First quarter sales at the grocery home-delivery site fell short of Wall Street analysts’ expectations for the Q1 of this financial year, largely the result of a net loss that had doubled after extra charges and restructuring costs.
Costly reasons are not enough to retain interest in the current mood that surrounds Internet investment however, and in a bid to keep its stock listed on the Nasdaq Stock Market, Webvan has now revealed plans of a reverse-spilt of its shares and the closure of its operations on the high profile market in Atlanta.
The Foster City, Calif., company has undergone several major retrenchments in recent months, pulling the plug on its Dallas and Sacramento markets, and this latest move is one more giant step away from Webvan’s ambitious target of servicing every major US city.
Spokespeople revealed that the operation was simply not profitable, and was not performing as well as other markets. Shutting down in Atlanta will mean the redundancy of up to 885 employees and the company’s withdrawal from its purpose built US$35-40m warehouse in the city.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalDataWebvan is also expected to announce today the appointment of COO Robert Swan to the position of CEO, following George Shaheen’s resignation earlier in April.
