They’re on a tear.
The brick-and-mortar bloodbath continues for an iconic Southern California fashion retailer.
Orange County-founded Torrid has reportedly shuttered a total of 177 stores since last year — as part of an ongoing company shift to digital sales, the company said.
The plus-sized retailer announced earlier they would be closing approximately 180 stores in total.
“Digital continues to be our customers’ preferred channel, now approaching 70% of total demand. We’re accelerating our transformation to a more digitally-led business, which includes optimizing our retail footprint,” Torrid CEO Lisa Harper said in a previous earnings call.
Harper said the move would allow the company to “reduce fixed costs and reinvest in areas that drive long-term growth.”
As of this month, Torrid’s total number of stores is down to 457 locations across the U.S., Puerto Rico, and Canada — and that’s fine, the CEO insisted.
“Customer retention through this transition has remained strong, with our marketing efforts successfully redirecting traffic both online and to nearby stores,” Harper said in the company’s latest earnings call.
Torrid was founded in 2001 and opened its first location at the Brea Mall, in Brea. The retailer offers clothes and accessories for women sizes 10-30.
The company’s net sales decreased 11.8% to $231.7 million compared to $262.8 million for the second quarter of last year, and its comparable sales decreased 6.3% in the second quarter.
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The company’s gross profit margin, however, increased 38.7% compared to 35.6% in the second quarter of last year. It’s net income also went up to $5.2 million, compared to a net income of 1.2 million in last year’s second quarter.
The dramatic move to slash stores could help the business in the long run.
“Torrid shedding a huge chunk of its stores is a brutal, necessary acknowledgment that physical stores were becoming a drag on their bottom line. When over 70% of your sales are happening online, maintaining hundreds of low-productivity mall leases is just burning cash,” RTM Nexus CEO Dominick Miserandino told TheStreet.
The closures meet the needs of its customer base, which clearly prefers online shopping, he explained.
