TRUNK CLUB TO CLOSE ALL STORES, ERIK NORDSTROM NAMED SOLE COMPANY CEO

Tuesday was a big day for Nordstrom. After years of trying to grow Trunk Club, Nordstrom is set to close all six standalone stores and will fold the brand into existing Nordstrom stores.

“Our plans include relocating clubhouse styling to nearby Nordstrom stores to reach more customers,” Erik Nordstrom, CEO, said on the March 3rd earnings call.

Founded in 2009 by Brian Spaly, Trunk Club quickly gained notice from the industry due to its online and in-store personal service and wardrobe advice. The originally men’s only retailer then expanded into women’s fashion and was acquired by Nordstrom for $350 million in August 2014. In June 2016, Trunk Club closed its Goose Island fulfillment center and laid off around 250 workers. Spaly departed at the end of 2016. 

However, the company stabilized and announced a fresh hiring round of 175 full-time positions in January 2019, including approximately 120 in Chicago. With the new hires, Trunk Club expected to generate a half-billion in revenue by 2021. But now, with this announcement, potential employee impact and timing of the relocation were not provided.

Nordstrom also said on Tuesday that it will be shrinking its board to 10 directors from 11 and establishing a new 10-year limit for members.

Further, the retailer announced that it will transition from its co-president structure to a sole chief executive officer, with Erik Nordstrom to serve in this role. Pete Nordstrom has been named as the company’s president of Nordstrom Inc. and chief brand officer. The new titles reflect their current and ongoing responsibilities. Both Erik and Pete Nordstrom will remain on the company’s Board of Directors.

“These titles help clarify our respective roles, as we strive to maximize our impact both as individual leaders and as a team,” said Erik. “Pete and I continue to be partners in ensuring Nordstrom’s success, and we are both focused on executing our long-term plan. We look forward to continue working with our Board to deliver on our shared vision for the future of Nordstrom.”

The retailer announced the changes as it reported fourth-quarter earnings and sales that missed analysts’ estimates. Net income for the quarter ended February 1st fell to $193 million, or $1.23 per share, compared with $248 million, or $1.48 a share, a year ago.