Dive Brief:
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Stitch Fix is closing a Pennsylvania cut-and-sew factory and knitting mill, resulting in the loss of 56 jobs, according to a filing with the state’s department of labor and industry.
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The company is “committed to supporting [affected employees] with severance payments that increase with tenure, extended healthcare, recruitment resources, and other benefits,” a Stitch Fix spokesperson said by email.
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The apparel box retailer acquired the plant, Mohnton Mills, in 2017 to produce a sustainable, size-inclusive private label dubbed “Mohnton Made.” That label will be discontinued, the company said by email.
Dive Insight:
Stitch Fix joins Old Navy in attempting to merchandise for more customers, only to scale that back not long after. Its Mohnton Mills closure comes as the apparel box retailer slashes expenses to stem losses.
In June the company cut about 330 positions, 15% of its salaried workforce. In its last fiscal year, just ended, net revenue fell 1.4% to $2.1 billion, as net loss grew to $207.1 million from $8.9 million last year, and the cost of goods sold rose nearly 1%. The company lost 370,000 customers in its most recent quarter, or 9% of its active client base.
“As we focus on the strategies that support our return to profitable growth, notably increasing our number of active clients and optimizing our cost base, we have made the incredibly difficult decision to close our operations at Mohnton Mills,” the Stitch Fix spokesperson said Thursday. “While this is the right decision for our business, it is a hard day for our team.”
Efforts to expand representation in fashion and make more sustainable apparel are important to younger consumers, research has shown. Mohnton Made has been offering “relaxed, modern styles” in sizes XS to 3X in women’s and XS to 3XL in men’s. The e-retailer has worked with Green Matters Natural Dye Company to manufacture the clothing with collected rainwater and plant matter.
Stitch Fix said that discontinuing the brand won’t interfere with its goals in the space, however. Some 70% of its owned labels are size inclusive, including its recently launched active and lounge brands, and the company still aims for 100% size inclusivity for all its exclusive brands by fiscal year 2025, the spokesperson said. The company also notes that many of the name brands it sells, including Madewell, Universal Standard, Vince, Adidas, Beyond Yoga, Cosabella, Good American and Under Armour, have size-inclusive offerings, and it has worked with Amour Vert and Liverpool on size-inclusive collections.
