Jenny Craig will shut down as early as Friday after four decades in the weight loss and nutrition business. Employees received an email late Tuesday from the company stating it will close “due to its inability to secure additional financing.”
Corporate and salaried field employees’ last day will be Friday and hourly center employees’ last day working was Tuesday.
A WARN Act notice sent last week informed employees that Jenny Craig would close its Carlsbad, California, office June 24. However, if the company cannot secure financing to continue operations, it may close as soon as May 5.
In an FAQ sent to employees, the company explained it would wind down physical operations to transition to an e-commerce model and “has been going through a sales process for the last couple of months.”
A Jenny Craig spokesperson said that the company “is embarking on the next phase of our business to evolve with the changing landscape of today’s consumers. Like many other companies, we’re currently transitioning from a brick-and-mortar retail business to a customer-friendly, e-commerce driven model. We will have more details to share in the coming weeks as our plans are solidified. “
Jenny Craig has been losing money while searching for a buyer, and two current corporate employees worry the company will file bankruptcy by the end of the week.
Jenny Craig was founded in 1983 to help people lose weight and was endorsed by actors like Kirstie Alley, Valerie Bertinelli and Jason Alexander, and singer-songwriter Mariah Carey. The program provided special menus designed by chefs and nutritionists to help consumers lose weight. Unfortunately, the endorsement from celebrities is not enough to sustain the company.
The foundation of Jenny Craig’s client-facing operations happened at its physical centers, according to employees. However, consumers have leaned toward online services in recent years. Another factor working against Jenny Craig is the popularity of weight loss drugs like Wegovy, Rybelsus and Ozempic hitting the market.
The medications, which mimic hormones found in the body to support weight loss, have recently grown in popularity thanks to reported use by celebrities and posts from everyday people on social media about successful weight loss.
Employees have said there was no indication that the company was “spiraling”. The company was posting job openings on LinkedIn and one employee said she was given a raise and new training a few weeks prior, according to NBC.
In the termination letter, employees were told they will receive a “final paycheck, including full compensation earned through your last day of work and all accrued, unused paid time off.”
