MuseumCompany.com Cuts StaffMuseumCompany.com let go of eight of its 40 employees yesterday, citing seasonal and economic reasons.
The move comes just two weeks after Christmas, a season that accounts for between 50 percent and 70 percent of the retailer's annual sales.
Dean McWhorter Johnson, president/CEO of the Charlottesville, VA, company, attributed the job cuts to a combination of factors.
"One is, there are seasonal factors," Johnson said, "which, like any retailer, we need fewer people after Christmas than before. Two, we've just finished building online stores for the Smithsonian and other noteworthy museums, and these construction projects have ended. And, three, prudent belt-tightening in the face of a possibly weakening economy."
The eight employees were offered two weeks' severance pay.
The cuts come only three weeks before the company initiates its first e-mail marketing campaign for Valentine's Day.
A letter signed by Johnson and sent to employees explained the rationale behind the company move.
"MuseumCompany.com sales volume as well as the sales volume of nearly all Internet retailers has grown more slowly than expected," the letter said. "In order to use our capital as efficiently as possible and to ensure a viable business, the company has made a viable decision to modify its business strategy.
"This change," the note continued, "necessitates staff reductions in certain departments. Unfortunately, your position is one that will be eliminated. We regret any distress this will cause you and your family and hope that we are able to make the transition as easy as possible for you. You will be missed."
The Museum Company, the nation's leading retailer of museum-related merchandise, owns one-third of MuseumCompany.com. The Museum Company posted sales last year of $100 million. Investors own the rest of the online company, which went live in May.
An employee, who did not want to be named, said he was called in at 8:45 a.m. yesterday and was told the news by a senior vice president and a vice president.
"There were a bunch of investors that were touring the building," the employee said. "It definitely caught us off guard."