Pier 1 To Close Stores, Layoff Staff. Future Uncertain

FORT WORTH, TX - Pier 1 Imports, the chain store specializing in home furnishings and décor from around the world, has announced it intends to close almost 50 percent of its stores nationwide, laying off some 40 percent of its staff in the process.

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."

Pier 1 operates 10 stores in Colorado including 2 stores in the Springs area, at the First & Main Town Center, and in the Promenade Shops at Briargate. A list of the stores to be closed has yet to be made public. Requesting anonymity, store staff expressed concern that they had yet to be informed of their futures.

In addition to closing store sites Pier 1 also plans to close distribution centers and lay-off 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 has engaged 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 are down more than 10% against the previous year, and current 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, those 145 planned closures. The retailer had already closed 30 stores earlier in 2019.

Despite the closures 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. On the NYSE, the company’s stock fell more than 40 percent overnight.

Pier 1's corporate media office has yet to respond to requests to comment for this article. The article will be updated once the locations affected have been announced.