Stitch Fix discontinues full-time roles for stylists, letting go of select leads.
Title: Stitch Fix Bids Adieu to Full-Time Styling Positions, Shifts to Part-Time Model
Dive Brief:
- Stitch Fix is phasing out full-time styling roles as of March 31, 2023, as confirmed by the company via email. The news was initially reported by Modern Retail.
- As of July 2023, Stitch Fix employed roughly 2,620 stylists, with about a quarter working full-time. Ten "styling leader" positions were also cut, the company announced.
Dive Insight:
Stitch Fix has been on a tight leash with expenses to minimize losses and boost margins, although profits remain elusive. Sales and the number of active customers have been dwindling in recent quarters.
The company reported a 17.8% year-over-year net revenue decline for Q1 in December and a 15% drop in active clients. This marks the seventh consecutive quarter of year-over-year sales declines, averaging 18%, with analysts predicting double-digit declines to continue.
Stitch Fix explained the move as an effort to "deliver the most innovative, personalized and convenient online styling experience." Full-time stylists who choose to leave will receive severance, healthcare, and career transition support. Most have opted to work part-time and will receive a payment for doing so. Stylists can now choose to work 28 hours or 12 hours per week, with a flexible range of about 10 to 20 hours per week, and their benefits will convert to mental wellness and family planning resources.
Correction: The number of stylists mentioned in this story has been revised to reflect Stitch Fix's most recent annual report.
Contextually Speaking:
While Stitch Fix didn't disclose the reasons for the change, it could be an attempt to cut costs, boost operational flexibility, or rely more heavily on technology. This shift could impact the workforce, client experience, financial performance, and the innovation/technology aspect of the company.
- Stitch Fix has announced an update to its policy, transitioning from full-time styling roles to a part-time model, effective March 31, 2023.
- The move is expected to affect the workforce, with roughly 2,620 stylists and ten "styling leader" positions potentially facing layoffs.
- Amidst decreasing sales and active customers, Stitch Fix aims to "deliver the most innovative, personalized, and convenient online styling experience" through this change.
- The company plans to offer severance, healthcare, and career transition support to full-time stylists choosing to leave, encouraging most to work part-time instead.
- A significant reshuffle in the working hours is apparent, with stylists now having the option to work 28 hours or 12 hours per week, with a flexible range of about 10 to 20 hours each.
- This update could have far-reaching implications for the business, including potential impact on workforce, client experience, financial performance, and the innovation/technology aspect of the company.
- The year 2023 is marked by significant changes for Stitch Fix, not only in terms of workforce policies but also in the larger landscape of lifestyle, health, AI, business, and finance, as the company navigates the complexities of the modern retail sector.
