SAN FRANCISCO—On Monday, June 1, San Francisco-based online retailer Stitch Fix announced that come September, it will let go of 1,400 of its stylists living in California.
Stitch Fix employs around 8,000 people. The job cuts will reduce its pool of 5,100 stylists by about 27 percent. The company will make up for this personnel decrease by hiring 2,000 stylists in locations that are cheaper than California. The hiring will start this summer and continue through 2021.
Founded in February 2011 by CEO Katrina Lake, Stitch Fix is an online personal styling service for women, men, and children. Customers first take a quiz to determine their clothing style and pay $20 for a Stitch Fix stylist to make customized clothing or accessory choices for the buyer. The clothing items are delivered to the customer by mail where they can pay for the pieces they like and return the rest for free.
During the coronavirus pandemic, Stitch Fix kept continued providing services to customers, but made adjustments to its operations. On March 20, the company released a statement announcing the temporary closure of its distribution facilities in Bethlehem, Pennsylvania and South San Francisco.
On April 8, the company announced that, as a result of business uncertainty, it was withdrawing its financial projections for the third quarter and 2020 fiscal year.
In a statement, Lake noted that employees who are laid off will get severance packages and extended health-care coverage. “Any decision that impacts our hardworking and talented people is incredibly tough, but we believe this is the right thing to do for our business,” said Lake.