Bebe to Shutter 2b Bebe
Bebe Stores Inc. announced June 27 that it will shutter its 2b Bebe division in a cost cutting effort that will eventually save the retailer $9 million to $10 million annually.
Described as “sexy, affordable fashion,” on the division’s website, 2b Bebe runs 16 mall-based stores and an e-commerce site. Jim Wiggett, Bebe’s interim chief executive officer, said that the closure of the division would allow the company to focus on the core Bebe brand. “This is a difficult step, but important to the long term success of our brand,” Wiggett said in a company statement. “As we prepare for the next fiscal year, we continue to evaluate our cost structure, capital expenditure requirements and dividend payments, and we will remain focused on carefully managing expenses and inventories, as well as preserving our cash."
Wiggett joined Bebe June 12 after Steve Birkhold, Bebe’s former chief executive officer, resigned.
Wiggett also announced a cost-reduction program, which will cut 9 percent of Bebe’s non-store employees, and less than 1 percent of its store operations team. A company statement noted that severance packages were given to those whose jobs were cut.
For its fourth quarter of fiscal 2014, Bebe now forecasts its comparable-store sales to be in the negative low single-digit range. When it announced results for its third quarter of fiscal 2014 on May 8, Bebe forecasted that same-store sales for the fourth quarter would be “flat.”
For its third quarter of fiscal 2014, same-store sales decreased 5.7 percent, and net sales declined 17.2 percent to $93.5 million, from $112.9 million in the same period last year. Bebe currently runs a fleet of 224 stores across U.S., Canada, Puerto Rico and U.S. Virgin Islands