Sweetgreen Co-Founder and CEO Jonathan Neman shared the following note with employees on Wednesday, October 21st.
During our virtual Town Halls over these past 7 months, my goal has been to be as transparent as possible about all parts of the business, and today, I have hard news to share.
We have moved forward with reorganizing and restructuring our team so we can put our company on a stronger and more focused path to profitable growth. This will mean different things for different people — some roles will evolve, some departments will remain the same and unfortunately, some roles will be eliminated. We are reducing 20% of the sweetgreen corporate workforce and this morning, we met with each employee whose role has been eliminated. No roles in the field were impacted.
Transparency is part of our core at sweetgreen and something I deeply believe in so I want to share as many details as I can on how we got here, what the future of sweetgreen looks like, what we are doing for those leaving, and what to expect next.
A new restaurant reality
The restaurant industry continues to be severely impacted due to COVID-19. Recent data from Yelp shows that, since March, 61% of all restaurant closures are now listed as permanent on its platform, and many offices are not returning until next summer.
In our updated forecast we shared in April, we had expected more employees to return to offices after Labor Day and that we’d see a stronger ramp in economic recovery. The reality is many of our restaurants in dense urban areas, particularly in NYC, have yet to recover.
We expect that this will be the case for the foreseeable future, but the one thing I’m absolutely sure of is that we’ll recover as people, as a business and as a community. Over time, we will come out of this stronger with a reinvigorated sense of purpose for connecting people to real food.
What restructuring and reorganization looks like
We’ve finalized a roadmap for the next two years that focuses on the areas that will have the greatest positive impact on the future of sweetgreen. From accelerating our store growth in new communities, reducing menu and operational complexity, investing in and elevating our store leadership and enhancing our digital ordering, this plan will change how we work. This means that we need to reduce our investment in areas that do not directly support these objectives.
Once we modeled slower financial recovery for 2021, the first things we looked at reducing were non-headcount related expenses across the company including leases, consultants + vendors, temp spend and so on. After we looked at all these costs, we started looking at headcount and determined how each team supported this new roadmap.
We then determined the appropriate size for each department moving forward. Teams were impacted differently based on how this slower economy will affect our business.
What we’re doing for those leaving
To take care of those leaving, we have looked across severance, healthcare, and job support and done our best to treat everyone in a compassionate and thoughtful way. Here are some ways we’re helping:
- Severance: Employees will receive a minimum of 6 weeks of severance pay and up to 12 weeks based upon tenure.
- Healthcare Continuance: We are providing company-paid COBRA through year-end.
- Employee Assistance Program “EAP”: Network access for 2 months to provide critical support from a comprehensive menu of private individual services including mental health webinars, wellness practices, careers resources and personal counseling.
- Job Transition & Outplacement Services: Employees will be provided with professional career transition services aided by a personal career coach to help them successfully target and secure a new job.
- Alumni Opt- In Program: To provide networking, job search tools and support including alumni calls with members of the People team to help with successful navigation through this transition.
Today, you should have had a conversation with your team where your leader shared additional information around if there would be any changes to your department and explained what the coming days will look like in more detail. I know there will be additional questions over the next few weeks and the People team along with your exec leader can provide clarity.
A moment of gratitude
To those leaving us, we are grateful for the passion and purpose you brought to sweetgreen. Each and every one of you has helped build sweetgreen into what it is today and I can’t express how appreciative I am. Over the past 13 years, the one thing I have been most proud of is this team. I have been inspired by all of you.
This crisis has forced us to reflect and remember what makes sweetgreen what it is. I believe it’s our mission — connecting more people to real food. This remains unchanged and will continue to be our North Star.