Outdoor gear retailer REI, based in Seattle, has announced the closure of its Experiences business, leading to the layoff of 428 employees. This division encompassed adventure travel, day trips, classes, and various events. Among those affected are 180 full-time and 248 part-time staff members who were instrumental in overseeing REI’s Experiences offerings, providing a range of indoor and outdoor classes, skills instruction, and travel excursions.
The decision was communicated to all employees by REI CEO and President Eric Artz in a message shared on Wednesday. Artz expressed the challenging nature of the choice, stating, “After a thorough review and careful consideration, I have made the difficult decision to exit the Experiences business altogether, effective this week.” He recognized the dedication of the Experiences team, acknowledging their hard work in educating and creating memorable experiences for nearly one million individuals over the years.
The Experiences division, serving 40,000 customers in 2024, accounted for less than 0.4% of all REI Co-op customers. Despite this, Artz highlighted that the business incurred significant costs exceeding its revenue. He explained, “When we look at the all-up costs of running this business, including costs like marketing and technology, we are losing millions of dollars every year and subsidizing Experiences with profits from other parts of the business.” The unsustainable financial situation necessitated a strategic adjustment.
In response to the layoffs, Artz outlined the support and benefits provided to affected employees. Full-time employees whose positions were eliminated will receive their regular salary through March 9, 2025, along with benefits until the end of March. They will also be eligible for separation benefits such as severance, healthcare coverage continuation via COBRA, and outplacement service support. Shared employees, who divided their time between Experiences and stores, were encouraged to explore continued employment options with store managers. Part-time employees will retain benefits through January 2025 and qualify for a severance payment.
In consideration of the contributions made by the impacted employees, Artz assured that they will receive a bonus payout for 2024 based on performance and remain eligible for current and future job opportunities within REI. The company aims to facilitate a smooth transition for those affected by the restructuring.
The closure of the Experiences business marks a strategic shift for REI as it reallocates resources to enhance overall operational efficiency and financial sustainability. While the decision brings challenges for the employees directly affected, the company is committed to supporting them during this transition period.
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This article originally appeared on USA TODAY, reporting on REI’s decision to shut down its Experiences business, impacting 428 employees.
