VF Corp Announces Layoffs at Vans’ Costa Mesa Headquarters

News Summary

VF Corp has revealed plans to lay off 82 employees at its Costa Mesa headquarters as part of a strategic workforce reduction of 400 positions across the company. The layoffs, impacted key roles in footwear and apparel management, are set to take effect on June 29. This move, linked to VF Corp’s Project Reinvent, aims to address declining revenues, including an 11% drop for Vans. As the company faces financial pressures, these layoffs underline ongoing challenges in the apparel industry.

Costa Mesa – VF Corp, the parent company of the popular retailer Vans, has announced plans to lay off 82 employees at its Costa Mesa headquarters as part of a broader initiative to reduce its workforce by 400 positions across the organization. A Worker Adjustment and Retraining Notification (WARN) letter detailing the layoffs was submitted to state employment officials on April 29, with the layoffs set to take effect on June 29.

The positions impacted by this reduction include key roles in footwear and apparel product management, buying, design, and project management across various divisions. Among those affected are a head designer of footwear and a digital marketing associate. This downsizing is part of the company’s ongoing efforts towards what they describe as a “select commercial functions global reorganization,” aimed at turning around the business amidst declining revenues.

This announcement comes against a backdrop of similar workforce reductions in the apparel industry. Earlier in the year, Liberated Brands, another clothing company based in Orange County, filed for bankruptcy and closed its corporate offices, resulting in 363 layoffs. Additionally, VF Corp plans to close a distribution center in Martinsville, Virginia, by March 2025, affecting an additional 242 employees as part of its broader business efficiency strategy.

The layoffs at Vans are notably linked to VF Corp’s Project Reinvent, which was announced in October 2023. The company is aiming to save $300 million in fixed costs and is focusing on right-sizing its structure and reducing debt in response to ongoing financial challenges. Recent reports have shown that VF Corp’s revenue has been declining, with the company experiencing a 6% drop year-over-year in Q2 earnings. Specific revenue decreases include an 11% drop for Vans to $667 million, and 3% drops for The North Face and Timberland, among others.

In addition to the current layoffs, Dickies, a brand owned by VF Corp that is presently based in Fort Worth, Texas, is in the process of relocating to Costa Mesa, although it remains unclear how many employees will make the move. As of May 30, Dickies was also expected to reduce its workforce by 125 positions in Texas, adding further strain to the company’s employment situation.

VF Corp has acknowledged the contributions of those affected by the layoffs and has emphasized its commitment to conducting the process with “dignity and respect.” However, the decision to lay off employees reflects the company’s need to adapt to changing market conditions and previous struggles with revenue across its major brands. The recent downgrade of VF Corp’s credit rating from “BBB-” to “BB” by S&P further illustrates the financial pressures the company is facing.

Overall, the layoffs at Vans mark a significant setback for the retailer and underscore the evolving challenges within the fashion industry, as companies strive to remain competitive and profitable amid fluctuating market demands and economic uncertainties. As VF Corp navigates these changes, the company will need to focus on stability and strategic planning to ensure the viability of its brand portfolio moving forward.

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Additional Resources

• Orange County Business Journal: Vans Laying Off 82 Workers at Costa Mesa Headquarters
• Google Search: Vans layoffs 2023
• Fashion Dive: VF Layoff 242 Employees at Virginia Distribution Center
• Google Scholar: VF Corp layoffs
• Reuters: Vans Owner VF Corp Lays Off 500 Employees in Restructuring Push
• Encyclopedia Britannica: VF Corp
• California Globe: Dickies Announces Surprise Move of HQ to California from Texas
• Google News: Dickies HQ move
• Star-Telegram: Dickies Moves HQ to Costa Mesa
• Wikipedia: Dickies