(Reuters) – Lululemon Athletica will close its distribution center in Washington state at the end of the year and lay off more than 100 employees, the clothing retailer told Reuters on Friday.
The Vancouver-based company will close its Sumner distribution center as part of efforts to streamline its business and cut 128 jobs starting June 21, according to a WARN notice filed with the state Employment Development Department.
The move comes as Lululemon (NASDAQ:) sees slowing demand for its premium athletic products in North America, where excessive inventory levels at athletic retailers have led to lower orders for activewear and apparel firms.
“We regularly evaluate our distribution network to help shape and support the future vision of our business,” a company spokesman told Reuters.
The lease for Lululemon’s 150,000-square-foot distribution center in Sumner is set to expire in July 2025, according to regulatory filings.
A company spokesman said some employees will be retained and transferred to other facilities, including a recently opened distribution center in the Greater Los Angeles area.
In 2021, the retailer entered into a new lease for an approximately 1.26 million square foot distribution center in Ontario, California. The lease expires in 2039, as stated in the annual accounts.
Lululemon, whose shares have fallen more than 31% this year, also owns a distribution center in Groveport, Ohio, and leases most of its other facilities located in the United States, Canada and Australia.