Kohl’s department store has announced plans to close 27 underperforming stores by April, marking a significant shift from its previous stance of avoiding closures. The company will also shut down its San Bernardino, California e-commerce fulfillment center in May when the lease expires.
Affected employees have been informed and offered severance packages or the opportunity to apply for open roles at Kohl’s. However, this move may be part of a larger downsizing effort, as Evercore ISI analysts previously warned that over 300 struggling locations needed attention.
In November, Michael Binetti led a team of analysts who noted that many stores were “consistently passed up” for reinvestment but had not yet been closed. The company stated in 2023 that it would avoid closures and instead expand its footprint.
However, after CEO Tom Kingsbury acknowledged that recent turnaround efforts had failed, the company is re-evaluating its strategy. Kingsbury did not directly address store closures during an earnings call, but CFO Jill Timm noted that Kohl’s is always assessing its fleet and identifying opportunities to address underperforming locations.
Following Kingsbury’s departure as CEO this month, Michael Buchanan of Michaels will take over the helm.
Source: https://www.retaildive.com/news/kohls-store-closures/737040