Pier 1 Store Closures: 45 Stores Or More Possibly Closing Within The Year

Another retailer has given in to the pressure of reduced sales, announcing that it is considering closing 45 brick-and-mortar stores within fiscal 2019. Pier 1 Imports (PIR) made the announcement on Wednesday during its fiscal fourth-quarter earnings report.

The home goods retailer said it closed 30 stores in its last fiscal year, leaving 973 operating locations. The new store closures will come as leases expire and may increase up to 15 percent if the company does not reach its revenue goals.

“As anticipated, our fourth-quarter sales and profitability were disappointing and reflect the execution issues we identified earlier in the year and have been working with urgency to correct," Cheryl Bachelder, interim Pier 1 CEO, said in a statement.

The plan to close stores is part of Pier 1’s action plan for fiscal 2020 to “drive benefits” of approximately $100 to $110 million. The company is planning cost reductions through revenue and margin, marketing and promotional effectiveness, sourcing and supply chain, cost cutting, and store optimization.

Pier 1 said it has identified $79 to $80 million in cost savings through selling, general, and administrative costs, which it expects to realize in the second half of 2019.

Net sales for Pier 1 in its fiscal fourth quarter decreased by 19.5 percent to $412.5 million vs. the $512.2 million in net sales the company reported in the same quarter of 2018. The company said that the net sales reductions were “a result of lower average customer spend, which is primarily attributable to changes in the Company’s merchandise mix, as well as decreased store traffic.”

The news that Pier 1 is considering closing stores follows home goods retailer Bed Bath & Beyond’s announcement that it will close 40 locations within the year.

Shares of Pier 1 were down 26.57 percent as of 3:31 p.m. ET on Thursday.