NetGrocer Bags CEO, Staff
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Online grocer NetGrocer is apparently cutting more than coupons, with Thursday's announcement that it has fired its chief executive officer and president and will reportedly cut up to 80 percent of its staff.
Those developments come after Wednesday's cancellation of a $38 million initial public offering.
The New York company released a statement Thursday saying Daniel Nissan, president and CEO had "ceased to be employed by NetGrocer." Reasons for Nissan's termination were not provided.
The company said shareholder Frederick Horowitz would immediately become interim president until a successor is named. Horowitz is president of Sales Marketing Group LLC, a private consulting firm.
The Silicon Alley Reporter, citing company sources, said Friday the company had already fired up to 80 percent of its staff. Company spokesman Jeffrey Steinberg declined to say how many workers had been fired. He said the reductions were necessary because the company needed to cut expenses. NetGrocer first hinted work force cuts were near on Tuesday when announced it was shelving its IPO first announced in August.
"The decision is solely based on market conditions," Steinberg said.
Instead of floating an IPO, NetGrocer will seek private funding that will allow it to expand.
Nissan launched NetGrocer in July 1997. The company targeted both Net-savvy shoppers and traditional customers.
Meanwhile, things aren't quite as bad for rival consumer goods retailer Peapod. The company said Friday that its membership surged 18 percent in the past year to 98,000 subscribers. However, the e-tailer is still losing money and reported a third-quarter loss of $5.1 million or 30 cents a share, compared to a loss of $2.8 million or 17 cents a share, a year ago.