Two of the US’s biggest fashion retailers are to slash hundreds of jobs in a bid to cut costs in the weak US retail market.
Talbots – which operates the Talbots and J Jill womenswear, shoes and accessories brands and has 870 stores across the US – will axe 370 jobs, or 17 per cent of its head office, as it aims to reduce costs by US$150m (£100.4m). The Massachusetts-based retailer has also identified 20 stores that are under review.
The decision follows a 24.6 per cent slump in same-store sales in Talbots’ fourth quarter. It expects to reveal wider-than-expected losses for the period.
New York-based fashion group Liz Claiborne, which owns brands including its eponymous label, Mexx, Juicy Couture and Kate Spade labels, will slash 725 jobs – an 8 per cent reduction in headcount.
The two fashion brands are the latest in a string of retailers to make redundancies to cut costs. At the beginning of the month, US department store Macy’s revealed plans to cut 7,000 jobs after issuing a profit warning.
Talbots majority shareholder Aeon has agreed to provide a US$200m (£134m) loan to the retailer to pay off debt related to its acquisition of J Jill in 2006. Talbots is continuing with its plans to sell the J Jill brand.
Liz Claiborne chief executive William McComb said: “The challenging retail and economic environment requires us to remain more focused than ever on cost rationalization.