Pier 1 To Close 450 Stores, Layoff Staff

FORT WORTH, TX - Pier 1 Imports, the specialized home furnishings and décor importer, has announced it intends to close almost 50 percent of its stores nationwide and lay off some 40 percent of its staff.

Pier 1 operates 20 stores in the wider LA/OC area, including 10 stores in Orange County. Huntington Beach, Costa Mesa and Dana Point are amongst the Orange County locations. A list of the stores to be closed has yet to be made public.

In a statement to investors, group CEO Robert Riesbeck said the closings would help the struggling retailer "better align its business with the current operating environment."

In addition to closing store sites Pier 1 also plans to close distribution centers and fire workers at the company’s corporate office in Texas.

"Although decisions that impact our associates are never easy, reducing the number of our brick-and-mortar locations is a necessary business decision," Reisbeck added.

The company is using a third-party liquidator to help with the closings.

As internet sales continue to increase as a percentage of customer spending, Pier 1 is the latest in a string of retailers struggling to keep their storefront locations open. Net sales for the group’s 2019 third quarter were down more than 13 percent. Company comparable sales were also down more than 10% against the previous year. Quarterly revenues are down almost 30 percent from their 2016 high.

Last year, Pier 1 announced that at least 145 stores would close early in 2020. It’s not known at this time whether the yesterday’s announcement of 450 closures includes, or is in addition to, the 2019 announced closures. The retailer had already closed 30 stores earlier in 2019.

Riesbeck, who was appointed both CEO and CFO last November, remains positive on the company’s future, “Looking ahead, we believe that we will deliver improved financial results over time as we realize the benefits of our business transformation and cost-reduction initiatives.”

Other commentators are not so sure. “As Pier 1’s losses deepen, the planned large-scale store closures and cost cuts will likely be insufficient to turn around the business in time to address the company’s looming debt maturities, making restructuring or bankruptcy highly likely scenarios,” Moody’s credit rating agency vice president Raya Sokolyanska said, speaking to Business Insider.

Pier 1 was founded in San Mateo, California, in 1962. By 2006 it had grown to a network of almost 1,000 stores in both the U.S. and U.K.

Pier 1 staff declined requests to comment for this article. The article will be updated once closing locations are announced.