JACOBSON STORES REDUCES STAFF
Byline: Vicki M. Young
NEW YORK — Looking to restore its profitability despite an anemic economy, Jacobson Stores Inc. said Wednesday that it would reduce its workforce by 5.5 percent.
The retail chain said that none of the staff reductions will come from its sales force. The reductions, about 225 of its 4,100 employees, will be from the ranks of the company’s buying, logistics and store support divisions. Nearly half of the job cuts will be made in Jacobson’s headquarters in Jackson, Mich. The balance will be spread across the chain’s 23 stores in Michigan, Ohio, Indiana, Kentucky, Kansas and Florida.
Jacobson said it will take a $600,000 non-recurring charge in the third quarter in connection with the move.
Carol Williams, Jacobson’s president and chief executive officer, said in a statement, “We assembled an outstanding team, sized to a strategy of increasing our existing sales base. Unfortunately, that growth was predicated on a healthier economy than we have now, or are likely to have in the near future.”
She said that the company was increasing the responsibilities of its employees to enable it to reduce expenses without having to compromise store service levels.
For the second quarter ended Aug. 4, the retail chain posted a loss of $14.3 million, or $2.47 a share, compared with a loss of $4.4 million, or 75 cents, in the year-ago period. Excluding non-recurring items, the loss in the quarter would have been $11.8 million, or $2.04. Comparable-store sales were down 6.3 percent to $88 million.
On Oct. 8, shares of the company hit a 52-week low of $2.01. Shares of Jacobson on Thursday were up 5 cents to $2.40 in Nasdaq trading.