Sunday, September 14, 2008

More Rumblings About eBay Layoffs!

eBay hasn't yet confirmed any layoffs, but I guess I'm not the only one who thinks they are on the way. According to Barrons; "Brian Blair and Ryan Hunter of investment-research firm Wedge Partners noted that eBay's business is "deteriorating," and that the company is preparing to fire as many as 10% of the company's 15,000 person workforce."
The layoff numbers that I am hearing are consistent with 10% of the eBay workforce and most of the speculation, centers around the Marketplace business, and will include International.
In labor law, there is a regulation for employers called the WARN Act, which helps ensure advance notice in cases of qualified plant closings and mass layoffs. Basically requiring the employer to give 60-days notice to employees of a major layoff. One provision makes it possible for eBay to avoid the WARN notice.
WARN is triggered when a covered employer:
"Lays off 500 or more workers (not counting part-time workers) at a single site of employment during a 30-day period; or lays off 50-499 workers (not counting part-time workers), and these layoffs constitute 33% of the employer’s total active workforce (not counting part-time workers) at the single site of employment" (bold is mine)
Since eBay has many locations, even within the San Jose area, and the WARN Act only applies to US jobs, they may be able to avoid requirement of the 60-day notice.

Just my 15%


ms.pat said...

Randy - Ebay stock is down to almost its lowest poing in five years and Deutch Bank expects it to hit 19.00 in Jan. 09 - its rumored they'll lay off 1500. It is hemmorraghing sellers who are also buyers. Last night I checked Ebay's rank on Google Page Ranker - they came up an 8 (they've always been a 9 out of 10) and Amazon came up ranked 9! Tell me, in your this the beginning of the end if Ebay doesn't do something drastic and soon? Do you think its too late to go back to classic Ebay?

Randy Smythe said...

Pat, read my latest post. I think they are committed to this through the end of the year but all bets are off for Q1 of 2009

Small Time Seller said...

Abandon ship. It's too late to be saved unless they reverse course back to their humble beginnings. Reduce staff, jettison businesses that aren't generting good income (ie skype), remove most hinderances to the seller, get rid of that stupid DSR/feedback situation, get rid of the crap that permenates 80% of the auctions, Woo-back the small seller, bring back the family/community fun that once existed. Once they made ebay into a corporate giant that was only out for grabbing as much money as they could, things went down the tubes. Say you're sorry, humble yourself and there are many folks who would love to come back to you.

Anonymous said...

they may be able to avoid requirement of the 60-day notice.

Yeah, and don't forget the old Silicon Valley IT worker standby, the Contractor. You can put WAY more people out to pasture than you report to either the Gov't OR Wall St. Just terminate a boatload of contracts and DUMP the work onto your salaried (+at this point, harried discouraged) employees.

Man- if you think their bugtraq programme sucks now, just wait 3 months!

nadine said...

FP30 will certainly up-end the categories where the new fvf structure makes it cheaper than stores. Where it's more expensive, people will probably take more of a wait-and-see attitude.

I agree wtih small time seller than ebay's attitude problem seems to be terminal. It's worse than just being a big greedy corporation than answers to the Street; most such corporations still maintain some awareness of who their paying customers are and understand that they must provide value for money, though service may slip as they become complacent.

eBay honestly seems to think of its paying customers as lab rats it can experiment with as it likes. Producing a result that is pleasant or profitable for the rats is very low on the priority scale. Can you honestly think of any other corporation, big or small, that has taken such an attitude?

Anonymous said...

I have heard eBay a company generates more revenue from paypal and Skype. Do you know if this is just concening ebay or will this be from paypal or maybe Skype only?

Randy Smythe said...


I think the majority of layoffs will come from the marketplace business, not PayPal or Skype, but that is just a guess.

Anonymous said...

As an ebay seller, youre right on they're leaving behind the bread and butter that built the business. Starting Oct 20, Ebay is telling its selling community, it will NOT ALLOW any seller to accept any money order or check if they choose. Ebay is forcing all seller to either accept Paypal or major credit cards ONLY. Of course they own Paypal and take their cut of that. So either way, it's another 3-4% of the selling price going to Ebay because of this edict. Sellers are leaving in droves

Anonymous said...

Glad to hear that the one time auction market fun place to make a few dollars is having a little trouble. Maybe they can understand the feelings of millions of sellers that have been put through all the different rules and added cost Ebay has caused all the " little guys " that made Ebay a one time giant. Some sellers on Ebay have went out of business after they left their real jobs and went to Ebay that they trustd to help both of them make money. The party is over for both Ebay and the sellers. Ebay won't change. You can look at their past records of selling increases , must use Paypal , feedback changes , canceling good seller accounts ( many for no reasons given that can be understood ), poor phone help , rude , optuse , and sometimes even worse customer relations. The buyers will have a great time , as long as Ebay exists. The buyers can still drain the sellers of every dime they have. Soon the sellers will be gone. Eventually , Ebay will just become another of the long list of online auction / stores sites that will make if anything , enough to pay the bills without a profit. Greed is a disease that is catchy and can and will get worse. Ebay has caught it. They had a great thing going , but didn't understand how to keep it. Life goes on , but Ebay as it once was known will be gone. Everything changes ; some for the better and some for the worse. Ebay has chosen the latter. Ebay should go to China as a home base. See if they will pay the price you want the Americans to pay.

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