When new employees join Patagonia, they’re handed a copy of “Let My People Go Surfing.” The company’s founder, Yvon Chouinard, who wrote the book in 2005, said it was intended as a “philosophical manual for the employees of Patagonia.”
In the book, Chouinard declares that treating employees well is a key corporate responsibility. “One thing I never wanted to change, even if we got serious: Work had to be enjoyable on a daily basis,” Chouinard wrote. “We needed to blur that distinction between work and play and family.”
Since its founding in 1973, Patagonia has positioned itself as a workplace nirvana — a community more so than a company, one that prioritizes the well-being of the Earth and of its employees above all else. But in the past few years, as sales have slowed, the outdoor-apparel brand has buckled down, cutting redundant jobs, tracking performance metrics, and banning long-standing practices such as letting sales representatives sell Patagonia samples to friends and family on the side.
It has also started to respond to customers’ demand for delivery at Amazon speed. The rejiggering is a means of survival, a necessity, Patagonia says, to provide for its 3,000-plus employees. But the retailer is now dealing with the fallout from disappointed staffers who say the new rigidity feels antithetical to the company’s ethos.
“It’s always been a self-critical culture,” Vincent Stanley, Patagonia’s director of philosophy, told Business Insider. “Whenever the company does something that’s not well understood to be part of the values, you get a lot of internal reaction to it.”
Patagonia is a billion-dollar company with more than 70 stores worldwide. The brand’s $130 vests and $280 jackets are just as likely to be sported on Wall Street as in the great outdoors — earning it the nickname “Patagucci.” Patagonia’s commitment to do good is integral to the brand. Over the years it has donated the equivalent of $226 million to environmental causes, and in 2001 it created an Earth tax, pledging 1% of sales to preserve and restore the natural environment.
Patagonia’s sales soared during the pandemic. From summer 2020 to summer 2022, sales grew at a rate of about 20% to 25% companywide, Alan Adams, a former US regional sales rep for Montana, Wyoming, and Alaska, told BI. Adams, who left the company in 2023, said COVID-19 restrictions led to an “unsustainable” boom, adding that the renewed interest in outdoor activities had people stocking up on all-weather gear and apparel. For a period, as California ports faced major backlogs, Patagonia relied on planes to transport about a third of its goods. (Before the pandemic, about 80% of Patagonia stock was shipped by barge, a decidedly more environmentally friendly option.) A Patagonia spokesperson told BI that it uses less air freight now than it did before the pandemic.
Patagonia started to attract a new customer base less attached to its green credentials and more demanding of superspeed delivery.
“What we do to make the customer happy and to save ourselves from backlash is not environmentally sustainable,” said a current customer-service, or CX, manager who has been at the company for multiple years. “If someone doesn’t like their repair, it doesn’t match perfectly, then we ship them a new item overnight.”
The Patagonia spokesperson said it had been tricky to navigate the demand for instant gratification. “What I don’t know is how do we support our customer-service team when customers are like, ‘Well, Amazon sends it to me overnight. Why can’t Patagonia?’” the spokesperson said. She added that Patagonia has an “ironclad guarantee” to give customers a new item if they don’t like a repair. While overnight shipping is an option, Patagonia tries to direct customers away from that choice with pricing and messaging, she said.
Workers said Chouinard, now 86, was typically one to challenge decisions that prioritized profit over sustainability. Adams recalled that at an event in about 2013 in Idaho, Chouinard seemed shocked at how large Patagonia’s sales representatives’ trucks were. He kicked a tire and asked one rep: “Why do you have this huge truck? That’s not what we’re about.”
In September 2022, Chouinard, who sits on Patagonia’s board, announced that he was giving away his shares of the company to a newly formed trust to fight the climate crisis.
At about this time, Patagonia began reassessing its operations. For the better part of the year, the spokesperson said, the senior leadership team was “locked in a room” figuring out which priorities they weren’t achieving and how decision-making could be improved. They also hired consultants to help restructure the company, the spokesperson added.
Many employees felt as though Patagonia’s new direction directly threatened the utopia they — and customers — had been sold. A worker from the digital team expressed concern about Patagonia’s buy-now, pay-later feature that launched this past June.
“It feels like it’s encouraging people to spend more money than they can currently afford, and buy more things that they don’t need, which goes directly against Patagonia’s mission and anti-consumption message,” the employee said.
Stanley, the company’s director of philosophy, told BI that growth had brought about “complicated decisions” like how to balance the long-term business health against the company’s core values while providing a consistent level of benefits to all employees. Financial stability, he said, was crucial for Patagonia to honor its commitments.
Like many companies in the wake of the pandemic, Patagonia was left with a surplus of staff and inventory, Adams said.
In the past few years, it has tried to rein in costs and streamline business operations. In the fall of 2022, Patagonia said it would stop allowing sales reps to sell extra clothing samples to their friends and family. Adams, who made about $350,000 in 2022, according to tax documents seen by BI, said this was a significant change. He said that even with a promised increase to his base salary and bonus, he would have expected to bring in just under $200,000 in 2023 under the new rules. (The spokesperson said the salary increases and bonuses were meant to fully make up any differences in sales reps’ total pay.)
The following year, Patagonia reversed a three-year-old policy of closing for the last week of December. The Patagonia spokesperson told BI that the new policy asked CX and warehouse employees to volunteer for holiday shifts in order to ensure customers received service during the busy season.
In July 2023, Patagonia introduced a career-leveling plan for all US employees to more clearly define roles and match pay grades to the market standard. The company also became more focused on tracking metrics across teams. “It used to be that we would be able to stay on the phone with a customer for an hour and a half and just connect with them and talk to them,” the CX employee who has been at Patagonia for multiple years told BI. “And now we get dinged for having long phone calls.”
Eventually, though, the company began cutting jobs. In June, Patagonia gave 90 employees on the CX team 72 hours to decide whether they wanted to relocate to one of seven US hubs or leave their jobs. Only four chose to relocate, according to an internal memo seen by BI.
The Patagonia spokesperson told BI that the changes were “crucial for us to build a vibrant team culture” and that the CX team had been overstaffed by 200% to 300%.
Three months later, Patagonia announced that 41 corporate staffers had been let go. In an internal memo sent the day the layoffs were announced, Stanley wrote that the company was experiencing the first sales decline in its history. In a follow-up FAQ about the layoffs, Stanley added that because of the financial strains, travel would be limited, bonuses would be lowered, and hiring would be paused across the company.
Employees aren’t going to be excited about protecting the planet if you cannot protect the people doing that work.
After being told for years how important employees’ happiness was and even being handed a book expounding these merits, workers were shaken. In “Let My People Go Surfing,” Chouinard called layoffs “almost unthinkable” for Patagonia and described a round of job cuts in 1991 as “the single darkest day in the company’s history.”
Several people said the 72-hour deadline for CX employees was insufficient to make such a major life decision. Another CX worker still at the company said the ultimatum was presented without “dignity or care or anything that Patagonia stands for.” During a time when workers more generally were growing distrustful of their workplaces, many felt Patagonia was trying to “quiet fire” staffers, with one employee calling it “an easy way for them to reduce their head count rather than waiting for attrition.”
Nick Helmreich, a team lead at Patagonia’s store in Reno, Nevada, since 2022, recalled one colleague telling him, “Camelot is truly dead.”
Many employees BI talked to said that, despite the recent upheavals, the company still treated its employees better than most corporations. But they said the brand was not living up to the standards with which it markets itself. In March, the 25 employees working at Patagonia’s Reno store formed the company’s first union. “Pay is really only one of the reasons for organizing,” Helmreich said. “Employees aren’t going to be excited about protecting the planet if you cannot protect the people doing that work.”
The CX worker who’s been at the company for years told BI that “the focus appears to be shifting away from the principles of mutual respect and community that Patagonia has long championed.”
Patagonia said it takes employees’ concerns seriously.
But as Stanley wrote in his internal note in September, the workforce may not always agree with leadership’s decisions: “The balancing act is delicate but is not essentially one of compromising between opposing interests (though some horse trading is involved). We are at our best when we can take a single action that benefits each of our stakeholders, or as many as possible.”
The post As Patagonia tightens operations, workers say the company has lost its soul appeared first on Business Insider.
