Eat Just: Layoffs Hit 18% Of Staff As It Aims For Vegan Egg Product Profitability

Plant-based food company Eat Just recently laid off about 40 of its over 300 employees, totaling 18% of its JUST Egg division. The California-based company’s cultured protein business, GOOD Meat, was not impacted.

The layoffs were made to cut costs and drive Eat Just’s commercialized egg product toward profitability, the company said in an email to NOSH.

Amid rising grocery inflation in August, Eat Just dropped the price for its liquid 12 oz. vegan egg by 40% to $3.99. Upon announcing the price reduction, the product achieved price parity with organic egg dozen carton prices ($4.02), though the price of traditional eggs have nearly doubled in the wake of an outbreak of the avian flu.

According to Eat Just, the company’s egg sales rose more than 85% over the past year to nearly 360 million total units sold. Additionally, a spokesperson said it has doubled its household penetration to over 2 million in the past two years and increased its points of distribution twofold in the same period. In January alone, household penetration increased 11%.

“Many of these folks have been fundamental to us getting here,” a spokesperson for the company said in a statement to NOSH. “Given the economic environment, we need to focus even more on building a high-impact company for the long-term, one where JUST Egg sales can fund our work in the future. This difficult decision, along with cost reduction measures across our upstream and downstream operations, is necessary to make that happen.”

While the company eye’s profitability for Just Egg, it reportedly is working on 20 additional cost cutting measures including reducing its spend on ingredients and increasing production efficiency. It also aims to invest in cost-effective growth areas including its R&D, operations and sales departments.

Based on LinkedIn posts from former employees impacted by the layoffs, the recent cuts hit all departments from engineers and food scientists to human resources and marketing teams.

Like many food tech players, Eat Just is utilizing a multi-pronged growth strategy. In addition to selling its egg protein as an ingredient supplier, the company also licenses its branded products to outside manufacturers. This removes the burden of producing the products, CEO Josh Tetrick previously told NOSH, allowing Eat Just to focus on R&D, marketing and product development.

According to the spokesperson, the company has implemented that strategy within a percentage of its U.S., Canadian, and Korean businesses, but emphasized that more needed to be done to the company toward profitability.

The layoff news is not an outlier within the plant-based protein space either. Over the past six months, category leaders including Beyond Meat, Impossible Foods and Oatly have let go sizable portions of their staff, each citing cost cutting measures in favor of steering operations toward profitable growth.

Outside the plant-based industry, numerous high-growth CPG segments have also felt pressure to cut staff and hone in on growth objectives due to the economic conditions. Earlier this month Daily Harvest reportedly laid off 20% of its employees, while Misfit Market and Imperfect Foods reduced staff following its merger late last year.

Despite the stream of layoff news, The U.S. Bureau of Labor Statistics reported that unemployment rates have dropped in 49 states while employment grew in 36 states and rates remained relatively unchanged elsewhere in 2022. In many cases, layoffs are impacting large tech companies, many of which are based in California. Unsurprisingly, the Golden State has seen one of the highest changeovers in its workforce with the rate of employed individuals dropping 3.1% over the past 12 months.