Stitch Fix Loses 370,000 Customers, Closes Mohnton Made Plant Amid Revenue Drop
Stitch Fix, the online personal styling service, has faced a significant setback with a loss of 370,000 customers in its recent quarter, equating to 9% of its active client base. This news comes amidst the company's decision to discontinue its sustainable, size-inclusive private label 'Mohnton Made', leading to job losses and plant closures.
Stitch Fix's recent fiscal year saw a 1.4% drop in net revenue to $2.1 billion, with a net loss of $207.1 million. The company has also increased its cost of goods sold by nearly 1% during this period. In June, Stitch Fix cut about 330 salaried positions, representing 15% of its workforce.
The decision to discontinue the Mohnton Made brand, launched in 2017, will result in the closure of a Pennsylvania cut-and-sew factory and knitting mill. This move will impact 56 jobs. Affected employees will receive severance payments, extended healthcare, recruitment resources, and other benefits. Despite this, Stitch Fix aims to maintain its commitment to size inclusivity and sustainability.
Stitch Fix is not the only retailer scaling back merchandise efforts aimed at wider customer bases. It joins others like Old Navy in this trend. The company's challenges and opportunities are currently the focus, with no specific external actors mentioned in relation to its strategies.
Stitch Fix's recent quarter has seen a significant loss in customers, and the discontinuation of its Mohnton Made brand has led to job losses and plant closures. Despite these setbacks, the company remains committed to its sustainability and size inclusivity goals. With increased costs and reduced revenue, Stitch Fix faces challenges that will require strategic navigation to achieve profitable growth.
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