Bath & Body Works will lay off 130 employees, mostly from leadership roles, as the retailer seeks to create organizational efficiencies by simplifying and realigning its operating structure. The announcement followed weak Q2 2022 results, with net sales of $1.6 billion, down 5% year-over-year.
The layoffs were part of a number of initiatives Bath & Body Works is pursuing to improve its financial performance and enable long-term growth, which also include pursuing cost-control actions and merchandise margin improvement opportunities.
“We are leveraging the dynamic environment to better position ourselves to capture new opportunities and drive future growth,” said Sarah Nash, Interim CEO at Bath & Body Works in a statement. “While we are taking aggressive action to control costs and improve overall efficiencies, we remain focused on customer-facing investments, including the upcoming launch of our loyalty program throughout the U.S. Looking to the back half of the year, we believe that our planned Fall and Holiday assortments are well positioned to resonate with our customers, and our inventories are clean and forward facing.”
The retailer expects its combined actions to result in $30 million in savings during the second half of 2022. The company also expects to record severance and other charges of approximately $6 million in the third quarter of 2022 related to the organizational actions.
Bath & Body Works is far from alone in making layoffs to help it survive a turbulent retail atmosphere. Other retailers that have recently let workers go include:
- ThredUP cut 15% of its corporate workforce and closed its processing center in Vernon Hills, Ill. to cut costs;
- Warby Parker also cut 15% of its corporate employees, or 63 people, to help it “operate in a more focused and nimble manner and to capitalize more efficiently on our highest impact opportunities,” according to a statement;
- Alibaba reportedly laid off close to 10,000 employees in anticipation of an economic downturn as lockdowns dampened China’s recovery; and
- Stitch Fix cut 15% of its salaried workforce, mostly in non-technology corporate and styling leadership roles, which will contribute to an expected $40 to $60 million in savings in FY2023.