Jul 15, 2020
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New York (CNN Business)Heritage Brands, an anchor of outlet malls across the United States, announced that it will close all 162 of its stores beginning next year.
PVH Corp., which owns Calvin Klein and Tommy Hilfiger, blamed the closures on the "evolving North American retail landscape, which has been accelerated by the Covid-19 pandemic" in a company statement released late Tuesday.
"We did not take these decisions lightly, as our Heritage Brands Retail business is our oldest retail business yet no longer met appropriate return metrics," PVH CEO Manny Chirico said in the statement.
The changes will also result in a 12% reduction in jobs, which amounts to roughly 450 employees, and it will save the company $80 million annually. Layoffs affect all three of PVH's retail companies, including Calvin Klein, Tommy Hilfiger and Heritage. In total, PVH (PVH) has 40,000 employees.
Heritage stores commonly operate as Van Heusen and Izod Golf stores. It also owns women's lingerie brands Olga and Warner's and men's casual brand Arrow. But the brands won't disappear: They will still be sold in department stores and warehouse clubs.
PVH is the latest retailer to reevaluate its brick-and-mortar footprint because of the pandemic, which resulted in temporary closures. In PVH's first quarter earnings report from June, it reported a 43% drop in revenue because its business was "significantly impacted" by Covid-19.
The shift toward working from home has also been detrimental to many companies that rely on office apparel. In the past two weeks, RTW Retailwinds, owner of New York & Co., and men's suit supplier Brooks Brothers both filed for bankruptcy.