Nordstrom announced Monday the phased elimination of 350 to 400 positions, some through attrition, to be completed by the end of the second quarter.
Nordstrom expects the layoffs, representing about 6% of its workforce, to save some $60 million in fiscal 2016. Most cuts will target staffers at the retailer’s Seattle headquarters, including employees in marketing, finance, legal and merchandising, according to the Seattle Times.
The news comes on the heels of Nordstrom's recent announcement that it would eliminate 120 tech jobs across its IT operations team.
For a while there, Nordstrom seemed to have shrugged off the troubles plaguing other department stores. But its last two quarters, which saw muted sales and weak store traffic, show that Nordstrom may not be immune after all.
In a conference call with investors last month, co-president Blake Nordstrom acknowledged the issues and said the retailer would be reducing expenses to boost profits. That worried some observers, including retail futurist Doug Stephens, who said cutting too far could endanger Nordstrom’s longstanding reputation for stellar customer service.
“Cost cutting and luxury department store experiences don’t often mix very well,” said Stephens, author of "The Retail Revival,” who blogs at the Retail Prophet. “The first thing you do is cut people because it's a huge [expense]. Nordstrom has this old-fashioned, very personalized, great level of service for which they’ve become notorious. The moment you start cutting into that, and you have one salesperson working in two departments, it becomes a horrible downward spiral. My adage is: 'Don’t spend your effort trying to cost less—spend your effort trying to bring even more value to customers, and make yourselves even more indispensable to them.’”
Nordstrom appears to agree, as Blake Nordstrom took pains in a statement Monday to note that the latest cuts wouldn’t impact in-store employees.
"We will never change our commitment to serving customers, but recognize how they want to be served has been changing at an increasingly rapid pace," Nordstrom said. "Meeting our customers' expectations means we must continually evolve with them. We see opportunities to create a more efficient and agile organization that ensures we're best positioned to achieve our goals."
Nordstrom last month cut 120 jobs in its IT operations as part of a restructuring of its tech team, which has been ongoing for the past seven months. Although top positions weren’t part of the cuts, GeekWire noted that several executives have left the department store’s tech team in recent weeks, including VP of Technology Bill Tucker, VP of Enterprise Architecture and System Development & Support John Mayfield, and EVP of Selling Technology Sam Hogenson.