The closing of a Virginia facility now leads to hundreds of layoffs according to a Worker Adjustment and Retraining Notification notice.
VF Outdoor LLC, a subsidiary of VF Corp., issued a Worker Adjustment and Retraining Notification (WARN) on November 15 regarding the closure of its distribution center in Martinsville, Virginia.
This facility, which spans 500,000 square feet and was established in 2001, is set to close in March 2025.
Earlier in May, VF Corp. announced plans to shut down the Martinsville center, but the specifics of the layoffs were not disclosed at that time.
According to the WARN notice, 242 employees will be affected by the closure by January 19, 2025.
A representative from the Service Employees International Union confirmed the layoffs, stating that the union had negotiated a severance package.
Further details about the closure and future work relocation were said to be available only from the company.
In a statement, a VF spokesperson explained that the decision to close the Martinsville facility was part of the company’s Reinvent strategy.
This strategy aims to optimize product shipping to better serve customers.
The spokesperson noted that shipping will now be handled through the Ontario, California distribution center and a third-party logistics provider.
Its Martinsville center will remain operational until March 2025, and VF Corp. intends to support its employees during the transition.
The spokesperson expressed gratitude for the dedication of the team at the facility, highlighting their commitment over the past two decades.
The WARN notice follows a recent downgrade from S&P, which lowered VF’s rating from “BBB-” to “BB.”
This downgrade indicates that while the company may be less vulnerable in the short term, it faces significant challenges due to adverse business and economic conditions.
David Swartz, a senior equity analyst at Morningstar Research Services, noted that VF is struggling and cutting costs, with discussions about streamlining operations at a recent analyst event.
Swartz remarked that VF’s slower growth justifies the closure of certain facilities, suggesting the company may prefer not to invest in new technologies across all centers.
He also mentioned that the company has opened a new distribution center in California that does not support the East Coast.
In October 2023, VF launched Project Reinvent, a strategic initiative aimed at achieving $300 million in fixed cost savings by reducing spending in non-essential areas, restructuring, and lowering debt.
VF’s recent Q2 earnings report indicated a year-over-year revenue decline of 6%, with all major brands—such as Vans, The North Face, Timberland, and Dickies—experiencing drops in revenue.
For more Layoff News and updates like this, join the newsletter or opt-in for push notifications.
Follow Daily Market News for regular Economy updates.
Share this article on your favorite social platform.
About The Author
Leave your thoughts below.
Read Daily Market News – https://franknez.com/ for more news and updates like this.