Throughout the fiscal year of 2022-23, Redbubble, a Melbourne-based print-on-demand company, executed a significant reduction in their staff numbers. The company laid off 141 personnel, a move which represented a 37% shrinkage of their global workforce.
Of this percentage, 14% of the staff were dismissed at the onset of the year in January, followed by a broader cutback in May that accounted for the remaining 23%. These figures were linked to the company’s calculated strategy aimed at reducing its operating expenditure for the year. This plan is expected to yield a sizable saving of $45 million across several areas of the business.
CEO and Managing Director of Redbubble Group, Martin Hosking, delivered insights into the financial maneuvers at the company’s Annual General Meeting on Tuesday. He projected an estimated operating expenditure for FY24 that ranged between $92 million and $100 million. Martin Hosking defined the cost cutting as falling within three primary areas – operating costs, brand-related expenses, and personnel reduction.
In an effort to curb operating costs, the senior management team carried out an exhaustive review of all existing contracts. This exercise steered the company towards a significant reduction in costs linked to website hosting and software.
As part of the reduction in brand-related expenses, the company suspended a brand awareness project in January. The group did not envisage this undertaking yielding an adequate financial return.
On the people front, the company was met with the challenging task of reducing its staff numbers. Apparently, this was a thoroughly deliberated move targeted at maintaining the company’s ability to cater to priorities while steering the group towards growth.
The company experienced a financial rollercoaster of sorts in October, with share prices soaring by 30%. This came as a welcome turnaround, given that the company had suffered a 40% plummet in share prices in August 2022 as a result of escalating costs and a dwindling customer base.
However, the journey through the fiscal year wasn’t devoid of controversy for Redbubble. Earlier in 2022, they were slapped with a $78,000 fine, compensating the Hells Angels motorcycle club. The company found itself amid legal issues when it emerged that the gang’s exclusive artwork, insignia and branding were being illegally sold on items like t-shirts through Redbubble’s platform. In similar controversial issues, the company drew legal action from fashion designers and gaming company Atari Interactive, who accused Redbubble users of uploading copyrighted art for sale on their online marketplace.
