Business of Fashion: Ralph Lauren Closes 50 Stores and Cuts nearly 1,000 Jobs
The CEO of Ralph Lauren, Stefan Larsson just announced his “Way Forward” plan last week; shutting down 50 stores nationwide and letting go nearly 1,000 jobs in his latest strategy. Coming over from H&M and Old Navy, Larsson turned Gap’s sister store into a powerhouse by giving it a full makeover.
Ralph Lauren’s net sales fell 3% in the last fiscal year. The brand wants to move in a faster pace by cutting down its employees, which will make up about 8% of the brand’s full-time workforce, removing layers within management and allowing for more promptness in decision-making. The pace is also being implemented due to the supply and demand of the clothing in-stores. According to Reuters, 15 months is the current turnover for products and Ralph Lauren wants to shorten it to 9 months. The brand has struggled to clear excess inventory recently, therefore margins have taken a heavy cut due to wide discounts provided in department stores.
Larrson has worked with the likes of H&M for about 15 years, developing the company’s sales from $3 billion to nearly $17 billion. The annualized savings from the reconstruction is estimated to save $180-220 million for the brand. We’re hopeful this plan will aid America’s sweetheart label back to the top.by