Pier 1 Imports said it will close nearly half of its stores and corporate layoffs are coming.
The retailer intends to reduce its store footprint by up to 450 locations, it said in a statement, and close certain distribution centers and reduce its corporate expenses. This includes a reduction in corporate headcount.
“Fiscal third quarter sales and margins remained under pressure as we completed our efforts to clear out non-go-forward merchandise,” said Robert Riesbeck, Pier 1’s CEO and CFO as of November of last year. “Looking ahead, we believe that we will deliver improved financial results over time as we realize the benefits of our business transformation and cost-reduction initiatives. To further advance our progress, we are announcing additional actions today that will enable us to move forward with an appropriately sized store footprint and operating structure as an omnichannel retailer, and better position Pier 1 to meet our customers where they shop.”
Company comparable sales decreased 11.4% in Q3 2020, compared to the third quarter of fiscal 2019. Net sales decreased 13.3% to $358.4 million compared to the third quarter of fiscal 2019.
According to Bloomberg, Pier 1 has drafted a bankruptcy plan and last month made a presentation to creditors that envisioned a smaller company with about $900 million in annual sales. It also has held talks with current lenders about providing Chapter 11 financing, reportedly, and the headquarters staff cuts affect about 300 employees.
There were more than 950 Pier 1 stores in the U.S. and Canada as of November, 2019. Pier 1 is utilizing the services of a third-party liquidator to help manage the store closings.
“Although decisions that impact our associates are never easy, reducing the number of our brick-and-mortar locations is a necessary business decision,” Riesbeck added. “We thank our team of hard-working associates for their commitment to Pier 1 and to serving our customers.”