North America's oldest company will be cutting 2000 jobs
- Author: Zachary Reyes Jun 09, 2017,
Jun 09, 2017, 9:13
Hudson's Bay Company is cutting 2,000 positions in North America as quarterly losses mount and brick-and-mortar stores come under increasing threat from online competitors. The company's stable of retail banners includes Hudson's Bay, Saks Fifth Avenue, Home Outfitters and Lord & Taylor.
The company also announced it has split the Canadian and U.S department store operations back into two groups, five years after putting Hudson's Bay in Canada and Lord & Taylor in the US under the control of one management team.
The Canadian-based business laid out a transformation plan to cut costs by eliminating excess staff and flattening organizational structure.
First-quarter results are "not an overly meaningful quarter for the company, and weather was certainly unfavourable, but the trends at both HBC and across the US department-store space remain worrisome", Mark Petrie, retail analyst at CIBC World Markets, said in a report last month.
The layoffs and savings, which include numbers previously announced by HBC after it released disappointing sales results in February, will also incur one-time charges of about $95 million over the next 12 months, the company said in a statement.
The company said it expects to save more than $350 million per year once the plan was fully implemented by the end of fiscal 2018.
Hudson's Bay and other large retailers are struggling to reinvent themselves amid an industrywide upheaval that has seen shoppers migrate online.
"While the retail apparel market remains particularly challenging, we are taking steps to adapt, beginning with our transformation plan announced today", Baker said.
Alison Coville has been named president of Hudson's Bay and will focus on the operations in Canada, while Liz Rodbell will continue in her role as president of Lord & Taylor.
HBC said it is overhauling its operations to integrate more digital functions throughout the organization.
HBC's new operating model. HBC.
HBC's buying and planning teams have also been restructured to reduce layers.
In addition, marketing support functions at HBC, including digital marketing, have been centralized to allow for cohesive all-channel marketing development across all of HBC's banners. These changes span its Canadian businesses as well as Lord & Taylor in the U.S. Digital operations will now be part of the logistics and supply chain group.