downsize

verb down·size \ ˈdau̇n-ˌsīz \
Updated on: 13 Oct 2017

Definition of downsize

transitive verb
1 :to reduce in size; especially :to design or produce in smaller size
2 :to fire (employees) for the purpose of downsizing a business
intransitive verb
:to undergo a reduction in size

Examples of downsize in a Sentence

  1. They have downsized the car's engine in the new model.

  2. The company is planning to downsize next year.

  3. The company will be downsized next year.

Recent Examples of downsize from the Web

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'downsize.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

First Known Use of downsize

1975


Financial Definition of DOWNSIZE

downsize

What It Is

Downsizing is a strategy used to reduce the size and scope of a business in order to improve its financial performance, usually by laying off employees or closing less-profitable divisions.

How It Works

Downsizing often takes place as part of a larger restructuring program at a company. Although it's usually thought of as a strategy companies use to become smaller, downsizing can also be the result of company mergers, acquisitions, and takeovers.

Its most common form comes in employee layoffs, which reduce payroll costs for the company. Downsizing may also involve shuttering some operations or offering certain employees early retirement.

Why It Matters

Downsizing is typically seen during economic downturns in order to improve efficiency and maintain profitability. However, if too many companies cut payrolls, it can further the downturn due to higher unemployment.

As well, companies may downsize in order to improve their attractiveness to potential acquirers and their cost-cutting moves could result in a buyout offer.


DOWNSIZE Defined for English Language Learners

downsize

verb

Definition of downsize for English Language Learners

  • : to make (something) smaller

  • : to make a company smaller and more efficient by reducing the number of workers



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