The parent company to footwear brands like BCBGMaxAzria, Jambu and StrideRite is cutting headcount amid a coronavirus pandemic eviscerating the fashion landscape.
Although the COVID-19 pandemic has been a major concern throughout the U.S. for nearly three months now, the hits still keep coming for apparel and footwear brands across the country and worldwide. Vida Shoes International, which designs, sources and distributes fashion-forward and outdoor adventure footwear for all ages, will lay off an unspecified number of employees and temporarily cut salaries in response to the crisis.
The corporate restructuring is a major cost-cutting measure as the company faces an inevitable economic downturn. Vida has not revealed details regarding whose salaries are getting cut, or the amount being reduced.
“Understanding the reality that we are faced with, it became necessary to evaluate the ‘right size’ of the company that puts us in the best position for success during this time, and into the future,” Solomon Dabah, president of Vida Shoes International, said in a statement.
In addition to Jambu and BCBGMaxAzria, Vida Shoes owns brands including JBU, J Sport, M.A.P. and Andre Assous and holds licenses to brands including BCBGeneration, BCBG Girls, Stride Rite, Carter’s, OshKosh B’Gosh, Kensie, Xoxo, Unionbay and Esprit.
Vida’s wholesale distribution is where the company likely was hit the hardest, with retail clients including department stores, independent retailers, specialty stores, national chains and mass merchants.
Department stores and specialty stores in particular have been severely hobbled by the coronavirus as most stores remained closed from mid-March through the entirety of April, and later into May. Prior to the major bankruptcies of J.C. Penney, J.Crew and Neiman Marcus among others, most department stores and specialty retailers already had implemented a series of cost-cutting measures, such as decreasing executive pay, furloughing staff members and slashing operating expenses. All in all, this economic environment has not been kind to major footwear brands.
Consumer spending on apparel and footwear fell a seasonally adjusted 28.2 percent in March to $2.91 billion from $4.06 billion in February, the Bureau of Economic Analysis (BEA) reported on April 30. Overall, footwear demand has suffered mightily throughout the pandemic and shoppers shifted spending to necessities versus nice-to-haves. U.S. footwear imports fell 15.5 percent to $5.4 billion in value in the first quarter compared to the same period in 2019, according to the U.S. Commerce Department’s Office of Textiles & Apparel (OTEXA).
In March alone, U.S. footwear imports fell at the fastest pace in years, vastly declining in volume and value, due to the COVID-19 crisis and from continued surges in duty costs, which reached $177.8 million, according to an analysis from the Footwear Distributors & Retailers of America (FDRA). The volume of footwear imported to the U.S. during the month sank a year-over-year 31.4 percent, the seventh straight monthly decline and the biggest drop in four years, FDRA said.
Despite the challenges within the industry, Vida says it is “well positioned” to move forward as a successful footwear company with the cuts. The restructuring plan outlines an intensified focus on digital and e-commerce strategy, as the company continues to expand its reach across different channels and markets.
Vida also continues to emphasize a relationship-based business model to better inform the customer journey within the Vida brand portfolio.