Online retailer Stitch Fix has announced it will close its two Berks County manufacturing facilities in Mohnton and Shillington. The closure will result in the layoff of 56 employees by the end of the year.
According to the company, all operations will cease at the plants on Oct. 28. The layoff of 52 employees will be effective on Dec. 2, with the layoff of the remaining four employees effective by the end of December, according to a Pennsylvania Department of Labor and Industry WARN notice.
The company said it is providing employees with two month’s paid notice, severance pay that increases with tenure, a stay bonus for those remaining to support with closing of the plants, extended health care coverage and career support.
“As we focus on the strategies that support our return to profitable growth, notably increasing our number of active clients and optimizing our cost base, we have made the incredibly difficult decision to close our operations at Mohnton Mills,” a company spokeswoman said in an emailed statement. “While this is the right decision for our business, it is a hard day for our team.”
The announcement comes on the heels of the company’s Sept. 20 earnings results for the fourth quarter and fiscal year 2022, which ended July 30.
Stitch Fix experienced a net loss of $96.3 million in revenue in the fourth quarter, when compared with the fourth quarter of 2021, and a decrease in active clients by 370,000 for the same period.
For the full fiscal year ending July 30, the company reported a net loss of $207.1 million in revenue from fiscal year 2021.
In announcing the financial results Sept. 20, Stitch Fix CEO Elizabeth Spaulding said, “Today’s macroeconomic environment and its impact on retail spending has been a challenge to navigate, but we remain committed to working through our transformation and returning to profitability.”
Stitch Fix purchased the former home of Mohnton Kitting Mills in October 2017, paying $210,000 for the 22 Main St., Mohnton, location and $90,000 for the 120 N. Sterley St., Shillington, location. The purchase included all the kitting, cutting and sewing equipment.
Stitch Fix purchased the properties from Gary Pleam, great-grandson of Aaron Hornberger, who founded the company in 1906.
At the time of the purchase, Stitch Fix said the mills would be used to experiment with making very small quantities of apparel to test with our clients.
Mohnton Made is a brand made at Mohnton Mills for Stitch Fix, using upcycled clothing and recycled polyester. (MEDIANEWS GROUP FILE PHOTO)
In December 2021, the company unveiled a new brand called Mohnton Made, which was cut and sewn in Mohnton, and made with upcycled clothing and recycled polyester imported from Mexico and Spain.
Stitch Fix has no immediate plans for the Berks facilities. No additional Stitch Fix locations are being closed at this time, the company said.
Stitch Fix is an online personal styling service. Clients receive apparel, shoes and accessories that have been personalized to their tastes, lifestyles and budget, according to the Stitch Fix website.