Sweetgreen cutting corporate staff | Fast Casual

Despite growing from 86 to 100 stores, and increasing domestic sales 11.9% to $160 million in 2019, Sweetgreen Co-Founder and CEO Jonathan Neman told employees Wednesday that he was reducing the corporate team by 20%.

“The restaurant industry continues to be severely impacted due to COVID-19,” he wrote in an open letter published on Medium. “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.”

The Los Angeles-based chain’s April forecast expected more employees to return to offices after Labor Day and to see a stronger ramp in economic recovery, but 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,” Neman wrote. “Over time, we will come out of this stronger with a reinvigorated sense of purpose for connecting people to real food.

Restructuring and reorganization

Sweetgreen is still growing, however, and Neman’s goals include reducing menu and operational complexity, investing in and elevating store leadership and enhancing digital ordering.

“This means that we need to reduce our investment in areas that do not directly support these objectives,” he stated.

After realizing that financial recovery was slow-going in 2021, the chain reduced non-headcount related expenses, including leases, consultants and vendors, and then determined the appropriate size for each department moving forward.

“Teams were impacted differently based on how this slower economy will affect our business,” Neman said.

Taking care of employees

To take care of the employees in the layoff Neman said the company is offering:

  • Severance: Employees will receive a minimum of six 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: Network access for two 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 and placement services: Employees will receive professional career transition services aided by a personal career coach to help them target and secure jobs.
  • Alumni opt-in program: To provide networking, job search tools and support including alumni calls with members of the team to help with navigation through this transition.

“To those leaving us, we are grateful for the passion and purpose you brought to sweetgreen,” Neman wrote. “Each and every one of you has helped build sweet green 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.”

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