Pier 1 Imports is planning to close 70 stores in fiscal 2020, and may shutter as many as 70 more as part of its cost-cutting plan, according to Interim CEO Cheryl Bachelder in an earnings call. The retailer is negotiating lease terms with its landlords to avoid the additional closures, but is prepared to downsize up to 15% of its 951 stores if necessary.
The retailer is coming off a challenging quarter that resulted in a 12.6% same-store sales drop. Pier 1 attributed a large portion of its $100 million loss to price reductions designed to sell slow-moving merchandise, which helped clear its inventory in time for the fall. Bachelder noted that this has allowed for an influx of new items and will reduce future reliance on promotions.
“While we anticipate that our merchandising and marketing initiatives will start to gain traction during the second half [of fiscal 2020], we expect a gradual recovery and believe we’ll be positioned to demonstrate year-over-year improvement in company comparable sales and gross margin rate beginning in the fourth quarter,” said Bachelder in a statement. “Our teams are working diligently to turn the business around and we believe that Pier 1 can prosper once again.”
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The Pier 1 turnaround efforts have included new leadership; the company appointed Douglas Diemoz to the newly created role of President to help oversee daily operations and performance, while Lance Wills was named EVP and CIO to help the company build on its existing technology platform and develop new capabilities.
