Michael Kors to Close Up to 125 Stores

Content Manager

Michael Kors is expected to shut down up to 125 stores this year, according to various media reports. Sales at stores opened at least a year decreased 14.1% in the recent fourth quarter and continue to fall, and its wholesale business also fell 22.8% in Q4.

Fortune reported that the Michael Kors operates 827 stores, so the store closures represent about 15% of its locations. Total sales decreased 11.2% to $1.06 billion in the fourth quarter.

“Fiscal 2017 was a challenging year, as we continued to operate in a difficult retail environment with elevated promotional levels,” said Michael Kors CEO John Idol about its earnings in a press release. “In addition, our product and store experience did not sufficiently engage and excite consumers.”

Idol said the company acknowledges it needs to take further steps to elevate the level of fashion innovation in its accessories assortments and enhance the store experience in order to deepen consumer desire and demand for products.

In addition to its own store closures, Michael Kors plans to reduce its exposure in U.S. department stores.

Idol said the company plans to expand the fashion innovation in its accessory assortments, right-size its store locations and elevate its store experience. Fiscal 2018, he said, will be a transition year in which Michael Kors seeks to established a new baseline before returning to long-term growth.

“We have a strong brand, led by Michael Kors, with a history of fashion innovation and leadership, a global footprint with stores positioned in the best locations around the world and the marketing expertise to effectively convey our fashion stories,” Idol said.

 

Partner Content

The Gift of Wow: Preparing your store for the holiday season - Netsuite
Being prepared for the holiday rush used to mean stocking shelves and making sure your associates were ready for the long hours. But the digital revolution has changed everything, most importantly, customer expectations. Retailers with a physical store presence should be asking themselves—what am I doing to wow the customer?
3 Critical Components to Achieving the Perfect Order - NetSuite
Explore the 3 critical components to delivering the perfect order.
Streamlining Unified Commerce Complexity - NetSuite
Explore how consolidating multiple systems through a cloud-based commerce platform provides a seamless experience for both you, and your customer.
Strategies for Maximizing Mobile Point-of-Sale Technology - NetSuite
Learn the top five innovative ways to utilize your mobile POS technology to drive customer engagement, increase sales and elevate your brand.