Canada Goose announced on Tuesday its plans to reduce its corporate workforce by approximately 17%, in line with a trend seen among several other retailers who have also initiated staff layoffs this year due to a decline in consumer discretionary spending.
“The exact number of employees affected by the layoffs remains unclear,” stated a spokesperson. The downsizing will impact personnel at Canada Goose’s corporate headquarters, which boasted around 915 employees as of April 2023, as indicated by a securities filing.
The filing further revealed a substantial increase in corporate head office staff from 544 to 915 between April 2021 and April 2023, aimed at supporting the company’s growth trajectory.
CEO Dani Reiss emphasized the rationale behind the decision, stating, “Today, we are realigning our teams to ensure that corporate resources are fit for purpose to fuel our next phase of growth across geographies, categories, and channels.”
Reiss added, “We are focused on achieving efficiency and margin expansion while investing in key initiatives — brand, design, and best-in-class operations — that will powerfully position our iconic performance luxury brand to deliver long-term growth.”
As part of its ongoing “Transformation Program,” the company has initiated these cuts after what it described as a “comprehensive review” of its organizational structure and required roles to achieve its objectives.
Anticipated to yield immediate cost savings, these reductions aim to streamline the workforce, facilitating quicker decision-making and enhancing efficiency.
Following this announcement, Canada Goose’s shares concluded trading approximately 7% lower.
Despite witnessing a 6% growth in sales during the three months ending December 31 compared to the same period last year, the company’s performance fell short of analysts’ projections, according to LSEG (formerly known as Refinitiv).
Notably, Canada Goose highlighted the persistent weakness in its wholesale revenues when releasing its holiday-quarter results, a trend shared by many other retailers.
Various retailers, including Under Armour and Nike, have recently reported sluggish wholesale orders, attributed to department stores’ efforts to manage inventories amidst a demand slowdown.
These challenges have prompted layoffs at Canada Goose, following similar actions by Nike, Macy’s, Wayfair, Hasbro, and Etsy in recent months.
In these instances, companies have aimed to enhance efficiency and prioritize profitability amidst reduced consumer spending on discretionary items like apparel, footwear, and toys.
