Lululemon Athletica (NASDAQ:LULU) announced on Friday its decision to shut down its distribution center in Washington state by the year’s end, resulting in the dismissal of over 100 employees. The closure of the Sumner facility aligns with the company’s ongoing efforts to optimize its operations.
According to a WARN notice filed with the state’s Employment Security Department, 128 jobs will be eliminated starting June 21. The move reflects Lululemon’s response to sluggish demand for its premium athleisure products in North America, exacerbated by high inventory levels at sporting retailers leading to reduced orders for sportswear and apparel brands.
The lease for the Sumner distribution center, spanning 150,000 square feet, will conclude in July 2025, as indicated in regulatory filings. While some employees will be offered positions at other facilities, including the newly inaugurated distribution center in the greater Los Angeles area, many will face displacement.
In 2021, Lululemon secured a lease for a 1.26 million-square-foot distribution hub in Ontario, California, with an expiration date in 2039. Additionally, the company possesses a distribution center in Groveport, Ohio, while leasing the majority of its other facilities across the United States, Canada, and Australia.
Featured Image: Freepik
