Royal Caribbean announced this week that it will cut 400 shoreside staffers as part of a plan to slash $125M/year in expenses. The spiking oil price is the culprit, lamented chairman Richard Fain, arguing that his cruise company is trading away far too much of its profits for bunkers. The lay-off revelation was preceded by weeks of rumours, but its scope still surprises: 400 employees equate to nearly 10% of the company's global shoreside staff. In a business where customer service is make-or-break, it's amazing that so many employees can actually be cut without degrading the product. It begs the question: exactly how much 'fat' did Royal Caribbean have on hand to trim? And after assuring shareholders for years that it pursued every avenue to cut costs, why haven't these 'excess' employees been cut before, assuming customer service can be preserved in their absence?
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