Even though new First Lady Michelle Obama has been providing J. Crew with a steady stream of good publicity, the apparel cataloger/retailer is under the same cost pressures as every other merchant today.
J. Crew Group on Friday announced a cost reduction program that’s expected to generate about $40 million in annualized pre-tax savings. The move includes eliminating 95 positions—about 10% of the staff—primarily in the New York offices and in its distribution centers.
The tough economic environment has also prompted the company to suspend its 401K plan company matching contributions through the rest of the year, and eliminate 2009 merit based wage increases companywide.
J. Crew is also looking to reduce costs is its supply chain, store operations, real estate, and catalog circulation.
Obama appeared on The Tonight Show clad in a J. Crew outfit in October and gave the retailer a plug; traffic on Jcrew.com shot up the next day. And for her husband’s inauguration ceremony, Obama sported green leather gloves from J. Crew, while first daughters Malia and Sasha wore specially designed outfits that came from the multichannel merchant’s Crewcuts division.