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Christopher & Banks cost saving plan begins with lay-offs
24 Feb '09
2 min read
Christopher & Banks Corporation announced that in response to the current economic and business environment it has implemented a cost saving plan for fiscal 2010 which includes a workforce reduction effective immediately.
The Company has, or is in the process of implementing, a number of selling, general and administrative cost reduction measures which are anticipated to result in more than $15 million of savings in fiscal 2010, which commences March 1, as compared to fiscal 2009. These cost saving initiatives include considerable year-over-year reductions in store payroll costs, professional services, independent contractors and travel. Also as part of the plan, there will be no merit salary increases and the Company is suspending its discretionary match contributions to the 401(k) plan.
The workforce reduction will impact twenty-four employees representing approximately 11% of the corporate headquarters employees. The Company will offer assistance to employees affected by the workforce reduction in the form of severance and outplacement services. As a result of the workforce reduction, the Company expects to record a charge of approximately $325,000 in the fourth quarter of fiscal 2009. The Company also believes that the annualized benefit resulting from the workforce reduction will greatly exceed this charge.
Lorna Nagler, President and Chief Executive Officer, said, “We have taken a number of actions to adjust our cost structure in order to strengthen our position in the current economic environment. This resulted in some difficult decisions with respect to reducing our current workforce. These actions will enable us to streamline our operating structure while also enabling us to emerge from this difficult period positioned for growth and improved earnings. As we move into fiscal 2010, we will continue to very carefully manage expenses and inventories, as well as preserve our cash.”
The Company has, or is in the process of implementing, a number of selling, general and administrative cost reduction measures which are anticipated to result in more than $15 million of savings in fiscal 2010, which commences March 1, as compared to fiscal 2009. These cost saving initiatives include considerable year-over-year reductions in store payroll costs, professional services, independent contractors and travel. Also as part of the plan, there will be no merit salary increases and the Company is suspending its discretionary match contributions to the 401(k) plan.
The workforce reduction will impact twenty-four employees representing approximately 11% of the corporate headquarters employees. The Company will offer assistance to employees affected by the workforce reduction in the form of severance and outplacement services. As a result of the workforce reduction, the Company expects to record a charge of approximately $325,000 in the fourth quarter of fiscal 2009. The Company also believes that the annualized benefit resulting from the workforce reduction will greatly exceed this charge.
Lorna Nagler, President and Chief Executive Officer, said, “We have taken a number of actions to adjust our cost structure in order to strengthen our position in the current economic environment. This resulted in some difficult decisions with respect to reducing our current workforce. These actions will enable us to streamline our operating structure while also enabling us to emerge from this difficult period positioned for growth and improved earnings. As we move into fiscal 2010, we will continue to very carefully manage expenses and inventories, as well as preserve our cash.”
Christopher & Banks Corporation
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