The RealReal Announces Layoffs and Store Closures — Retail Bum

The RealReal is making deep cuts as the resale platform struggles to turn a profit.

The company is planning to let go roughly 7% of its workforce, equating to about 230 employees — a move that would cost the company $1.7 million to $2.2 million in severance payments, employee benefits, and related expenses.

In addition, The RealReal will close its two flagship stores in San Francisco and Chicago, its stores in Atlanta and Austin, Texas, and two consignment offices in Miami and Washington, D.C. The company is also looking to reduce its office space in San Francisco and New York City, according to a filing with the Securities and Exchange Commission.

The decision comes as the company is facing bleak growth prospects in 2023. The RealReal has registered a year-to-date loss of $151.2 million, which marks just a slight improvement over last year, according to Neil Saunders, managing director at GlobalData.

“Although resale remains one of the stars of the apparel market with exceptionally high growth, the current environment is more challenging as consumers are a little more conservative about making purchases,” Saunders told Retail Dive.

“The competitive environment is also tougher with a raft of new resale players, including brands selling…