Published 08 April 2020
The COVID-19 pandemic is affecting all parts of the food industry, including tech companies that provide management systems to restaurants. One particularly successful company, Toast, has been forced to lay off half of their staff due to the food industry decline, despite an extremely profitable 2019.
April 8, 2020 — In a letter released on the company website, CEO Chris Comparato announced Toast’s decision to lay off 50% of its workers amid the COVID-19 pandemic. Toast, which creates and manages restaurant point-of-sale systems, has been significantly impacted from restaurant closures across the United States.
In the letter, Comparato states that, “As a restaurant management platform, our success is tightly coupled with the success of the restaurant industry.” With restaurant sales declining 80% in the month of March, the company pivoted to try and mitigate the changing industry landscape. The steps they took included:
While these initiatives helped to save jobs, they came at a cost to the company. These struggles came at an inopportune time for Toast, who saw their revenue grow by 109% in 2019. As a result, Comparato states that “to prepare for continued growth in 2020, we staffed up throughout 2019 to make sure we would have talented Toasters in place to build new products, sell, implement, and support our growing community.” As most restaurants began to close temporarily due to the COVID-19 crisis, the company found itself with more employees than it could support.
After a significant restaurant revenue plummet in March, Toast made the decision to scale back as much as possible. Despite these attempts, Comparato indicates that the uncertainty about how and when the food industry will recover has forced them to make the decision to lay off 1,300 employees.
Toast illustrates on their website how valuable their employees are to the success of the company and their story. The company hopes that once the COVID-19 pandemic passes, they will be able to return to supporting the food industry that they are so passionate about.