Sadly, we have another bad news retail story to share.
The very long-standing (and homegrown) Hudson’s Bay Company (HBC) recently announced that it plans to cut approximately 2,000 positions in North America as part of a transformation plan.
The plan, spurred by the brand’s lower quarterly sales, is expected to generate over $350 million in annual savings.
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According to the company, the plan will focus on “streamlining operations, increasing efficiencies and leveraging scale” and the job reductions will make for what the company is calling a “flatter, more nimble organization.”
Although the news is no doubt concerning for multiple HBC employees, the news isn’t terribly surprisingly when considering the challenges facing the brick and mortar retail sector. Over the past year, brands such as Danier, Aeropostale, BCBG, Express and Michael Kors have announced the shuttering of multiple stores due to falling sales.
“[The] transformation plan…is designed to make the company more agile to get ahead of the changing retail landscape, transform its cost base and deliver a best-in-class all-channel model that seamlessly integrates the in-store and online customer experience,” a recent HBC release reads. “The transformation initiative is the result of a six-month operational review focused on identifying efficiencies, streamlining processes and improving back-of-store productivity in North America.”
The $350 million in savings that HBC projects it will generate will, it says, “offset revenue, margin and cost pressures the company is facing as a result of the current environment.”
To better adjust to the changing retail landscape, the company is also focusing on the online components of its business.
“We are reallocating resources to accelerate the opportunity we see online, as we run our brick and mortar operations more efficiently,” says Richard Baker, Governor and Executive Chairman, HBC. “Our team is taking the right steps to optimize our North American business and create efficiencies by leveraging the scale of our company. At this critical moment of change in the retail industry, I believe in the future of our all-channel model and we are adapting to meet the evolving needs of our customers.”
It’ll be interesting to see how the age-old brand fares in a challenging retail market going forward.
There’s no word yet on which locations will be affected by the job cuts.