Dive Brief:
- Kohl’s on Wednesday confirmed to Retail Dive that it recently initiated layoffs that resulted in the elimination of “less than 60 positions.” Most of those people who lost their jobs worked on the company’s marketing or merchandising teams.
- Kohl’s said the decision was necessary to “drive greater efficiency in our operations.” Those affected will receive severance packages and outplacement services.
- The move came less than a month into the new year and followed a third quarter sales slowdown. Q3 revenue fell 7% to $4.3 billion, while net income fell by 60% to $97 million. In its Q3 report in November, Kohl’s withdrew its guidance for 2022. The company has not set a date to announce its Q4 or 2022 annual earnings.
Dive Insight:
About 60 people who worked at Kohl’s corporate headquarters are now out of a job.
“Kohl’s reorganized parts of our organization to drive greater efficiency in our operations. These efforts, which primarily impacted marketing and merchandising teams, reorganized some leadership roles and positions, including the elimination of less than 60 positions,” Jen Johnson, Kohl’s senior vice president of corporate communications, said in a statement.
“We put a great deal of planning into this decision and are offering a competitive severance package and outplacement services to all those affected,” Johnson said. “We appreciate the many contributions of the impacted associates and we thank them for their dedication and service to Kohl’s.”
Kohl’s has about 100,000 associates and 1,160 stores in every state except Hawaii, according to its latest 10-K. The company is based in Menomonee Falls, Wisconsin, near Milwaukee. The first Kohl’s opened in Brookfield, Wisconsin, in 1962. According to Kohl’s, when the company went public in 1992, there were 76 stores in the Midwest.
The layoffs come while the company is under interim leadership. In November, CEO Michelle Gass announced she was stepping down to accept a position as president of Levi’s. Gass deserves credit for leading the company through the pandemic and overseeing partnerships with Amazon and Sephora, GlobalData Managing Director Neil Saunders said in emailed comments in November.
Kohl’s chose Tom Kingsbury as interim CEO and he assumed that position in December. He has over 40 years of retail industry experience, according to a corporate biography. He’s likely to become the permanent CEO, according to the New York Times.
Kingsbury’s previous leadership roles include serving for more than a decade as president and CEO of Burlington Stores from 2008 to 2019. Kingsbury is also a member of the board of directors at Kohl’s, Tractor Supply Co., BJ’s Wholesale Club and Big Lots.
In addition to reducing its headcount, the company has also recently reduced the number of buildings and facilities in its portfolio, according to the Milwaukee Journal Sentinel. In April, Kohl’s sold a corporate building in Menomonee Falls for $4.3 million. Johnson told the newspaper at that time that the company had not actively used the space since early 2021.
And in November, the company sold two storage buildings to a local investor for just over $6 million.
via https://www.aiupnow.com
Nate Delesline III, Khareem Sudlow
