Ralph Lauren will close at least 50 stores and trim 8 percent of its workforce as the company looks to cut costs, reengineer the supply chain and right-size the store base.
|Stefan Larsson and Ralph Lauren|
Sales and profits have been falling at Ralph Lauren since 2014, and CEO Stefan Larsson's plan to reverse this trend first takes the form of restructuring.
Larsson joined Ralph Lauren in September and hails from fast-fashion chains H&M and Old Navy. He took over the duties of CEO from Ralph Lauren, who remains as chairman.
The focus is on stores, many of which were in subpar or outdated locations.
Layoffs aren't isolated to stores. The office of the chairman has been eliminated and decision making is now strictly overseen by Larsson and Lauren. Layers of management between stores and the CEO have also been reduced from nine layers to six, according to The Wall Street Journal.
Sourcing is another focus, as even a luxury label needs to compete with fast fashion. The goal is to reduce the timeline from design to stores from 15 months to nine. Larsson is also testing smaller product batches that can be produced in just eight weeks and then quickly reordered, a strategy that worked at Old Navy.
Look for the selection of higher-margin accessories to be expanded and apparel to focus on updated classics.
Still, the classic brand isn't shying away from new retail ideas. Tests of subscription programs are being considered, and the New York City flagship sports new in-store technology that includes smart fitting rooms.