Michael Kors is shutting down at least 100 stores following ‘catastrophic’ sales declines
Michael Kors’ total sales fell 11.2%, to $1.06 billion, in the quarter ended April 1, and same-store sales plunged 14.1%. After reporting dismal quarterly results, Michael Kors on Wednesday said it would shut down at least 100 stores.
The fashion brand’s total sales fell 11.2%, to $1.06 billion, in the quarter ended April 1, and same-store sales plunged 14.1%. The company said it would close between 100 and 125 full-priced stores in an attempt to improve profitability.
Neil Saunders, CEO of the retail-consulting firm GlobalData Retail, called Michael Kors’ sales results “catastrophic.” “Michael Kors’ precipitous drop in sales does very little to reassure that the company’s nascent recovery program is on track,” he wrote in a note to clients on Wednesday. He said many customers had abandoned the luxury-handbag brand for good, despite its efforts to rebuild by reducing promotions. “Looking ahead, it is clear that Michael Kors has further to fall,” Saunders wrote. The brand has failed to give once loyal customers a reason to return, he said. “In truth, ranges and collections lack oomph and definition, and across many established stores levels of service and merchandising are lackluster,” Saunders wrote. “In short, the brand is nowhere near where it needs to be if it wants to excite and inspire consumers.”