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Comment by danso | Hacker News Reader

In the case of your company, it seems that the loss of the coffee machine was just the start of an impending death spiral (er...or am I judging too much from the preface of "in the original dot-com bubble")...but what about more moderate scenarios?

Take, for example, Tumblr, which right now is a pretty big success. Just a month ago, they laid off their entire editorial team. Who knows if it was at all related to the Yahoo purchase, or if it was a decision made because Tumblr really need to cut expenses? But sometimes companies change course and cut because of ostensibly responsible financial concerns.

In the case when an exciting company has to trim (but not just die), how should it handle the case of having a fancy coffee machine and possibly saving a job? It seems it would be a bit awkward if the company laid people off but kept all of its original ostentatious perks.

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If you worked on the editorial team, it was a death spiral for you even if the rest of Tumblr went on to a big exit. (And off-topic, but: I bet those folks who used to work on the editorial team are cheesed they got canned right before the big payday.)

I have no knowledge of Tumblr's internal workings, but I would bet if you talked to the folks who used to be on that editorial team they'd have stories of their own budget being squeezed in trivial ways before the layoff. Laying people off is hard, managers don't like to do it, so they almost always look for other ways to save money before biting the bullet and canning people. And when management decides that a particular division isn't critical to the overall business, it's typical for the bean-counters to be unleashed on that division to look for "economies" that other divisions more beloved by management don't have to bear.

If they had 30 days to exercise their options they may have been able to buy their options in time. hopefully.

That's like saying it's be a bit awkward if they laid off a bunch of employees but kept all the salaries of the remaining employees the same. Because by removing the little perks they're trimming everyone's salary just a little. You're already asking your remaining employees to work a little harder to make up for the loss. No need to add insult to injury and ask them to do it for a little less as well. In a time of turmoil I'd rather keep as much as possible familiar.

Very good point. This goes hand-in-hand with "cut deep so you cut once." You can't leave that sword hanging over the heads of individual contributors or they'll activate their network and start entertaining offers.

Since the process of layoffs generally involves a rank-and-yank, the people who remain are precisely the ones who have the option of working elsewhere. They can generally (depending on the location) get an offer within a day.

That's also a really good point. I knew someone in that position and he didn't last much longer before bailing on the company. He had no problem getting new offers.

Companies just see an easy line item savings without thinking of the impact on the employees they desperately need to hold onto. On top of any potential insult to the employees, the companies that do this are giving off a terrible impression. "OMG. They can't even afford free soda anymore. This ship is definitely sinking."

I am curious about how much a coffee machine really costs. I don't think it can be that much to merit getting rid of it. People that try to save a few pennies usually waste much more elsewhere...

Exactly. The Coke that costs $1 in the store probably actually costs <10c if you buy in bulk! Let alone the $4 coffee from Starbucks!

Typically not that little in bulk, unless you stock your own entire soda machines with syrups and carbonation systems and such. If you had people stocking up from sam's club or a similar 'bulk' store, you'd be looking at per unit costs of 25-60 cents per bottled/canned drink, depending on size.

Coffee - not as familiar with the economics of coffee, but of course dedicated machines will end up costing somewhat less than going directly to starbucks.

And most Cokes in a convenience store are now $1.50 or more, at least where I live.

It's amusing, because a 2L from a supermarket is the same price as a 20oz from a convenience store. Clearly the price is not driven by the cost of the soda.

In the case of Coke, I think the cost of packaging is bigger than the cost of the product, but either way its almost irrelevant to the price - they charge what people are willing to pay. I wouldn't buy a big bottle from a convenience store, a small bottle is more convenient for walking around with. I wouldn't buy a small bottle from a supermarket, I want a big bottle to put in the fridge at home.

Typically the smaller ones are also refrigerated whereas the 2L aren't, precisely because you're expected to grab the former when you're on your way from A to B and are busy.

Let's say 50c per soda. Even if everyone drinks 6 sodas a day you're looking at an increase of $900/year/employee. Call it $100k/year for an engineer and you're talking less than 1%. And that's 6 sodas a day, every day. I bet even with free sodas you average maybe 2 a day.

And if you have an entire team of engineers drinking 6 sodas per day each, your health insurances will balloon (as will their waistlines) in the next couple years.

You handle it honestly, openly, and by negotiation with the workforce.

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