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Brandless, The Frills-Free Household Label Cutting Out ‘Brand Tax,’ Closes Down
By Mikelle Leow, 11 Feb 2020
Image via Brandless
Brandless, a cult-favorite label promising to deliver quality products at low, low prices, is closing its operations after a two-and-a-half-year run.
The company took on a barebones approach with distilled packaging and retail of household essentials and organic products cheaper than Whole Foods’, eliminating middlemen—retailers—so shoppers would be able to obtain premium-quality goods at near-cost price.
Tina Sharkey, co-founder and CEO of the company, wanted to tackle “BrandTax,” which can go up to 40-percent the price of an item because of packaging design and such, and aspired to bring the direct-to-consumer business model to consumer packaged goods. This launched an array of US$3 items. In time, Brandless expanded its selection with more premium products, but retained their prices at a multiple of US$3.
Brandless received a US$240 million funding from Japanese multinational conglomerate Softbank in July 2018. However, that could have hindered Sharkey’s vision as Softbank was setting high financial targets for Brandless, driving the brand to make profits, as reported by The Information. Sharkey eventually resigned from her position, which was filled up by then-CFO Evan Price and, finally, former COO John Rittenhouse.
Brandless has since released a statement attributing the “fiercely competitive direct-to-consumer market” for its closure.
A report by Protocol says Brandless has now dismissed 70 out of 80 employees, and has ceased taking in any more orders. The remaining personnel will focus on fulfilling pending orders and “[evaluating] any acquisition orders.”
The tech news site furthered that Brandless chose to shut down while it could still afford severance packages for its employees.
[via Fast Company, cover image via Brandless]
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