There were rumors about Zulily being in substantial financial trouble for a long time. Recently, users discovered that the site wasn’t loading.
This added fuel to the fiery rumors. So, what is going on with Zulily? And is it really shutting down?
Zulily’s website (zulily.com) says, “We are down for maintenance,” at the time of writing on December 20, 2023. Additionally, the company is planning a large number of layoffs next year and closing its warehouses in McCarran, Lockbourne, and Nevada. It is also battling legal cases of unpaid dues to employees and clients. So, all signs point to Zulily in financial trouble that can result in its closure soon.
Is This The End For Zulily? Why Is The Company In So Much Trouble?
Zulily, once a rising star in the world of e-commerce, has recently experienced a series of setbacks, culminating in a perplexing website maintenance message that has left many wondering about the company’s future.
As of now, when you visit Zulily’s website, zulily.com, you are greeted with a rather cryptic message: “We are down for maintenance.” The page is minimalistic, featuring only the company’s name and this phrase.
The big question is whether this downtime is temporary, signifying a routine maintenance update, or if it signals something more ominous for the retailer.
To understand the significance of Zulily’s current situation, we need to rewind to its beginnings.
Founded in 2010 by former Blue Nile executives Darrell Cavens and Mark Vadon, Zulily started by offering daily deals on products for mothers and children.
Over time, it expanded its product selection and adopted an unconventional business model. Zulily would sell products on its platform before actually ordering them from vendors, a unique approach that set it apart from other e-commerce players.
The company’s innovative model attracted significant investment from notable backers, including Andreessen Horowitz and Maveron. Zulily’s growth was rapid, with reported revenues reaching $331 million in 2012.
This momentum culminated in an initial public offering (IPO) in 2013, a spectacular event that valued the company at around $4.5 billion.
The following year, in 2015, Qurate Retail Group (formerly known as Liberty Interactive) acquired Zulily for $2.4 billion, a move aimed at strengthening Qurate’s presence in the e-commerce space.
Despite its acquisition by Qurate, Zulily faced ongoing challenges.
In the first quarter of its final year under Qurate’s ownership, the company reported a 17% drop in revenue, falling to $192 million, and an operating loss of $43 million.
The company’s struggles prompted its sale in May to Regent, a Los Angeles-based private equity firm. However, Zulily’s difficulties persisted even under Regent’s ownership, leading to layoffs and downsizing efforts.
GeekWire reported that the company announced plans to shut down its warehouses in McCarran, Lockbourne, and Nevada, Ohio, in addition to its Seattle headquarters, further impacting its workforce.
Internal communications indicated that layoffs will affect more than 500 employees. A filing with the Washington State Worker Adjustment and Retraining Notification (WARN) system revealed that 292 employees in Seattle would be laid off as part of this closure.
Severance packages were reportedly not provided to employees let go in June, leaving them in a precarious situation.
The challenges didn’t stop there.
Lawsuits were filed against Zulily by a logistics company and a software development consultancy, both alleging unpaid invoices.
Vendors who supplied products to Zulily also claimed they were not receiving payments following the Regent acquisition, further tarnishing the company’s reputation.
Amid these difficulties, Zulily filed a lawsuit against Amazon, alleging that the e-commerce giant’s tactics made it impossible for Zulily to compete on price without endangering its relationships with key suppliers.
Regent, the company’s current owner, is not mentioned in this lawsuit.
The abrupt departure of former CEO Terry Boyle in October added to the turbulence within the organization, leaving it without a clear leadership direction.
As we observe the troubling developments surrounding Zulily, it is clear that the company is facing a multitude of challenges. As such, it is likely to shut down soon.
Overall, it will be interesting to see how this case shapes up.
What are your thoughts about Zulily’s current situation? Will the giant company shut down completely?
Let us know your thoughts and opinions in the comments below.
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