NetGrocer Bags CEO, Staff

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.

NetGrocer Chairman Uri Evan will remain with the company and officials said
no other management changes would be made.

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.

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