LifeWay Christian Resources will cut staff and implement other budgetary cutbacks due to steep revenue declines caused by the COVID-19 pandemic, the organization announced April 29.
The measures go into effect May 1 and are expected to reduce recurring operating budget expenses by as much as $30 million, LifeWay reported in a news release. The company said revenue is down 24% compared to the same period last year.
The release does not say how many employees will be let go and a spokeswoman said she was unable not share that information.
“LifeWay stands to lose tens of millions of dollars of revenue that the organization would normally generate over the summer months from camps, events, VBS and ongoing curriculum sales,” CEO Ben Mandrell said in the release.
In addition to the staff reductions, the company said it will freeze hiring, salaries, 401(k) contributions and discretionary spending. Members of the executive leadership team will give up a month’s salary beginning next month.
“Additionally, LifeWay will likely have to use money from its reserves to cover a portion of the lost revenue,” Mandrell said.
While Bible and book sales have continued strong during this period, LifeWay attributed the steep declines to significant drops in bulk orders from churches for items such as Vacation Bible School products, Bible study materials and Sunday school curricula.
“We expect the impact of COVID-19 to continue to be felt here at LifeWay as churches slowly and cautiously begin to reopen their facilities and gather in person,” Mandrell said.
Through February 2020, LifeWay’s direct channel sales were reported 12% above the same period in 2019.
“LifeWay exceeded its first quarter revenue budget of $56 million by $600,000 or 1%,” the company reported. “By the end of March, LifeWay was 3% ahead of budget.”
The gains followed the closing of LifeWay’s chain of retail outlets in 2019. That year it also sold its distribution center in Lebanon, Tennessee.
But the pandemic had a major impact.
“It seemed like overnight we went from serving the church gathered to serving the church scattered,” Mandrell said.
LifeWay recently announced its intention to sell its Ridgecrest Conference Center and Summer Camps in North Carolina and said it will launch a feasibility study over the next several months to determine the future of its corporate office building in downtown Nashville.
The workforce cutbacks are difficult, but the company is determined to help employees in the transition, Mandrell said.
“We know these decisions will cause pain and affect every LifeWay employee in some way.”
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