Zulily Quietly Closes Down as Hundreds of Employees Are Laid Off Across the Country

Alex West - Author
By

Jan. 30 2024, Updated 11:46 a.m. ET

Zulily logo
Source: Zulily

The Gist:

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An affordable online site for mothers to buy name-brand goods for their children seems like a great idea. However, in Zulily's case, it doesn't necessarily seem to be working out that easily.

The company operated with a rotating roster of discounts, encouraging customers to check back for the next big deal. They also don't hold any inventory, but instead rely on drop shipping or vendor-owned merchandise. Zulily aimed to consolidate these into one marketplace that sells clothing, toys, and more.

However, it appears to be falling apart.

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The Zulily app on a phone
Source: Getty Images

Why is Zulily shutting down?

Zulily appears to be shutting down due to the "challenging business environment" and "financial instability," the company's website states. It also decided to start the process of shutting its digital doors on Dec. 22, 2023, in order to "maximize value for the companies' creditors." The company first raised red flags when it launched an "all things must go sale." The site completely then went offline under the guise of being "under maintenance." Shoppers can no longer gain access via the app either.

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If you were to visit Zulily's website now, you'll find the brief explanation as to why it is shutting down and points of contact for those who have questions or concerns.

The announcement begins, "Zulily, LLC and its parent Zulily Group LLC (collectively, “Zulily”) made the difficult but necessary decision to conduct an orderly wind-down of the business to maximize value for the companies’ creditors. This decision was not easy nor was it entered into lightly. However, given the challenging business environment in which Zulily operated, and the corresponding financial instability, Zulily decided to take immediate and swift action."

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On top of the technical delay, the staff is experiencing wide layoffs which is always a cause for concern in the business world. Across Washington, Nevada, and Ohio, the company is set to cut over 800 people, especially in their distribution centers, according to Retail Dive.

Often, companies are required legally to notify the state and employees when layoffs are coming. Since the company is based in Washington, it isn't clear if the cuts are coming from their administrative employees or just from warehouse staff. In Nevada, the layoffs center around the planned closure of a fulfillment center.

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As for Ohio, it appears there's a bit of both occurring. Another fulfillment center is set to close its doors, but the filing with the state also indicates that impacted employees will be “including remote employees who report to the facility.” What exactly the roles are or their functions aren't specified.

Teenage girls with shopping bags leaning on railing
Source: Getty Images
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Naturally, the company's former talent and staff flooded LinkedIn to look for new jobs. Eric Hanson, who worked in talent acquisition for the company, gave some more insight as to what is going on. He indicated that Zulily is "unfortunately closing its doors in the upcoming months."

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Zulily was bought out in May 2023 by Qurate Retail Group, the owner of QVC.

All of the layoffs and shutdowns come after a strategic business decision. In May 2023, Zulily was bought out by a private equity group Regent from Qurate Retail Group which notoriously owns QVC. The consumer shopping conglomerate historically keeps a variety of retail brands under its belt.

A man man shopping online at home
Source: Getty Images
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Just ahead of Qurate's move to off-board Zulily, came the launch of a new product. Sune is a video-based shopping app that aims to emulate the QVC trend in the modern world of the influencer. It's backed by Qurate Retail Group and leans into the current retailing trends.

The app launched in April and had been in development for months. However, the trend of video shopping accelerated quickly and is already latching onto consumers.

Sune is now competing against more established sites like TikTok. The era of video shopping is now upon us and it appears that it may have major implications for more traditional web retailers.

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