NEW YORK (TheStreet) -- E-commerce startup Fab.com will cut almost 20% of its workforce in a move to pivot its strategy away from Groupon-style (GRPN) flash sales. The company expects to cut 101 jobs including 84 from its headquarters in New York City.
CEO Jason Goldberg told employees in an internal memo that the cuts would affect the company's redundant flash-sale business structure or roles that could be executed by fewer people.
In September, the company announced it would be moving towards an inventory model to provide greater consistency to customers.
"Our processes are changing, along with our investments in technology that may impact the number of people required to perform various tasks," said Goldberg in a September employee letter. "A constantly improving cost structure is critical to providing our customers with ongoing benefits."
Fab.com, founded in 2011, sells design-focused merchandise and has been valued at around $1 billion. The company rings in an estimated $40 million in sales a quarter.
Fab.com's online retail route is similar in style to Urban Outfitter's (URBN) online strategy -- unusual, design-centric furniture, clothing and accessories.
TheStreet Ratings team rates Urban Outfitters as a Buy with a ratings score of B+. TheStreet Ratings Team has this to say about their recommendation:
"We rate Urban Outfitters (URBN) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, revenue growth, largely solid financial position with reasonable debt levels by most measures, expanding profit margins and good cash flow from operations. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself."
Highlights from the analysis by TheStreet Ratings Team goes as follows: