Weathering The COVID-19 Storm: Our New Reality

We now live in a world that just weeks ago would have felt unimaginable. For people all around the world, the rhythm of our daily lives have changed dramatically. The upheaval of our routines and rituals, the weight of social isolation, and intense uncertainty about the future is weighing heavy on us all.

This psychological weight is a great enough burden on its own. But to make matters worse, a side effect of taking the measures necessary to save lives is that our economy has screeched to a halt. We have undeniably entered a recession. The S&P 500 is down 25% off of its high in February. A staggering 3.3 million people filed for unemployment just last week, more than any week in 2008 and nearly five times the last record set in 1982. We have only just begun — this will only get worse before it gets better. The economic shockwaves will impact every American in some way. But as a CEO, my responsibility to my company and its people has made it something I have been forced to look squarely in the eye.

There has been much said about the impact COVID-19 will have on the travel industry: airlines, hotels, and cruise operators have all been hit hard. But not as much attention has been given to retail, an industry which supports one-in-four American jobs. With stores across the country closed indefinitely to support social distancing, retail is at major risk. E-commerce alone will not be the savior — economic uncertainty has understandably driven consumers to tighten their budgets to just the essentials, leading to a dramatic drop-off in demand. And even if customers shop, there is little certainty day-to-day that distribution centers will be able to continue operating to fulfill them. The result is an instantly altered consumer landscape that the industry must now find ways to navigate.

At Cuyana, we were among the first to close our stores, realizing our responsibility to protect our employees and customers from the spread of COVID-19. When we made that decision on March 13th, it was my truest intention that we would get through a few weeks of shutdown together, of course protecting our rockstar team members along the way. But in a matter of just a few days, the world changed again. It became clear that COVID-19 is a problem we will be dealing with for not weeks, but months or maybe years. I was forced to take dramatic action to give Cuyana the best possible chance at making it out the other side.

On Friday, March 20th, I made the difficult decision to part ways with many members of our team. This impacted all divisions of our company — not only our stores and distribution center, but also our corporate headquarters. We paid store staff for their scheduled shifts during the closure, and all impacted employees were provided severance pay.

This was not an easy decision — in fact, it was the hardest decision I’ve ever had to make as CEO. It was an absolutely sickening experience, made worse by the fact that we have prided ourselves all along the way in building a sustainable business where choices like this should have never had to be made. But that was in a world where external conditions were predictable and this felt like a massive storm that came out of blue skies. With so much now out of our control, I made the choice to take control of what we could to give Cuyana the best possible chance to weather the financial downturn. We cut costs everywhere else in the business before considering this option, but unfortunately, it was not enough. While we made these changes with heavy hearts, it was the only way to steel ourselves for a new reality.

To the colleagues we had to part ways with: it has truly been an honor to work alongside you. It is your talent, passion, and kindness that made me excited to come to work, and there will be a hole in Cuyana’s heart without you.

My goal for Cuyana and hope for the industry is to make it through this crisis and bring back as many jobs as we can as quickly as possible. Ultimately, I felt the best way to ensure that future reality was to make these hard decisions now.

We will find new ways of doing things with a dramatically different team, and we will find new ways of serving our customers in a paradigm where at least in the short-term, selling them a product is not the best way of connecting. We will pour all our energies into our core philosophy of fewer, better, and help ground our community on what matters to them most.

- Karla Gallardo, Co-Founder and CEO of Cuyana

Fewer, better is the philosophy behind everything we do. We design essentials for the modern woman with the promise of beauty and simple functionality.