Brier Dudley's Blog

Brier Dudley offers a critical look at technology and business issues affecting the Northwest.

October 22, 2008 2:09 PM

Seattle retail startup Mercent makes "prudent" layoffs

Mercent Chief Executive Eric Best took his foot off the accelerator and tapped the brakes.

On Monday the Seattle e-commerce services vendor laid off six of its nearly 50 employees.

Best, a former Amazon.com manager, said online retail is still expected to grow 12 percent this holiday season, compared with low single digit growth in offline retail, "but I look at this and think it's prudent to take a cautious approach."

(For an e-commerce indicator, see Amazon.com's just-lowered earnings forecast, leading to a 14 percent after-hours drop in AMZN to nearly $43.)

Mercent still has plenty of cash, Best said. It's been growing rapidly since receiving $6.5 million in funding last December, leading to 50 new customers using its platform.

Were investors calling for cost cuts? "Not particularly,'' he said.

Retailers using Mercent are still getting good results, he said, "so this decision related to the Monday reduction in headcount was really more about ensuring we're making the right decisions now to ensure the company is positioned well in the case that things really do get worse."

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