Abercrombie & Fitch Co. (NYSE:ANF) has announced that it is laying off 150 employees who work at its headquarters in New Albany.
“As part of our ongoing cost reduction initiatives and after careful consideration, the company has eliminated approximately 150 positions at the corporate level to ensure we are structured appropriately for the current retail environment,” the fashion retailer wrote in a statement.
Tough operating environment
At its New Albany headquarters the fashion retailer has about 2,200 in its employ. In the 2016 financial year the firm recorded revenues of $3.52 billion. The business environment for traditional brick-and-mortar retailers has become increasingly harsh in recent times as more and more shoppers turn to online shopping sites and brands such as H&M.
While there has been some progress made by the fashion retailer with regards to improving the business, sales have declined consecutively in the last four years. Compared to 2016 for instance, sales in 2013 were around $1 billion higher. With sales on a downward trend, the fashion retailer has been shutting down stores at the rate of around 50 annually. In the last six years, more than 350 store have been shut down in various locations around the globe.
The declining fortunes in the retail sector are not limited to Abercombie alone as Aeropostale Inc (OTCMKTS:AROPQ) has been in a worse position. In 2016 Aeropostale shut down 100 stores before filing for Chapter 11 bankruptcy protection. Yet another retailer to face the same fate is Limited Stores LLC which closed 250 stores before filing for Chapter 11 bankruptcy protection.
In the course of three years, American Eagle Outfitters (NYSE:AEO) will also be shutting down 150 stores. The same will apply to Express, Inc. (NYSE:EXPR) which will be shutting down 50 stores as leases expire. The Columbus-based retailer will remain with about 600 stores operating.
The harsh business environment has not spared department stores either with both Sears Holdings Corp (NASDAQ:SHLD) and Macy’s Inc (NYSE:M) announcing store closures.
In Thursday’s trading, shares of Abercrombie & Fitch Co. edged downwards by 2.66% Abercrombie & Fitch Co. (NYSE:ANF) To Lay Off 150 As Retail Sector’s Struggles ContinueAbercrombie & Fitch Co. (NYSE:ANF) To Lay Off 150 As Retail Sector’s Struggles ContinueAbercrombie & Fitch Co. (NYSE:ANF) To Lay Off 150 As Retail Sector’s Struggles Continueto close the day’s trading session at $11.71.