St. John Knits Gives Pink Slips to More Than 100 Workers
In an effort to cut production costs, St. John Knits is laying off 130 workers effective on June 26.
Notices were given to workers and news of the layoffs was filed with the state Department of Employment Development in late April.
The venerable Southern California fashion house, whose luxury label is known as St. John, is shifting some of its manufacturing jobs from its sprawling facilities in Irvine, Calif., to its plant in Tijuana, Mexico, while more jobs are being shifted to a contractor in Glendale, Calif., and to Chinese factories, said Bruce Fetter, president, chief executive and chief operating officer at St. John Knits.
“We have been doing some restructuring of our manufacturing team here over the last 12 months, and this reduction has been planned for some time,” Fetter said.
In 1998, St. John Knits set up a large factory just outside Tijuana, where many of its metal hardware such as belt buckles and buttons were made as well as jewelry. For some time, the luxury label has been using GSA Design, an independent sewing contractor in Glendale, to pick up its extra work.
St. John Knits, founded in 1962 by Bob and Marie Gray, has an international reputation for its high-quality separates and knit suits that sell for $200 to $2,000. Over the years, the company has tried to maintain its core customer, who is often a professional over the age of 40 who needs a sophisticated look that carries through the years.
For a while, a revolving door of past chief executives tried to capture a younger customer by employing Angelina Jolie and Gisele Bündchen as models. But lately St. John Knits has been relying more on social media and in-store events to get the word out about the brand.
St. John Knits is one of the few high-end manufacturers that still do the bulk of their production in the United States. The company is the largest flat-knitting factory in the United States with some 300 knitting machines. Its production facilities are housed in several buildings next to the St. John Knits headquarters in an industrial park.
St. John Knits started out as a private company, went public and then went private again. In 1989, with Bob Gray suffering health problems, he and his wife sold the apparel company to Escada for $45 million. The German apparel company took St. John Knits public four years later.
Then in 1999, the Gray family and Vestar Capital Partners took the company private again. Bob Gray passed away in 2012. Vestar Capital is still a majority owner with a minority stake being held by Fosun International, a Chinese investment company.
Layoffs in the apparel industry have ramped up this year. American Apparel, which filed for bankruptcy protection a second time, was sold early this year to Gildan Activewear, which paid $88 million for the brand name. All 3,500 workers at American Apparel were shown the exit door.
Troubled Los Angeles contemporary label BCBG Max Azria Group filed for Chapter 11 bankruptcy protection in late February, closing 120 U.S. stores and dismissing more than 300 employees. At the end of May, Bebe Stores shuttered all 168 of its stores and laid off more than 700 workers at its headquarters in Brisbane, Calif., as well as its Los Angeles design office and retail outposts.