MONROE, MI – La-Z-Boy announced it would immediately reduce its headcount by about 10 percent. The across-the-board layoffs will affect about 850 employees.
In addition, the company said it would close 15 to 20 retail stores over the next 90 days and would slash planned capital expenditures for 2009 from $27 million to between $18 million and $20 million.
Kurt Darrow, La-Z-Boy’s president and CEO, said, “Given the turmoil in the global financial markets coupled with declining consumer confidence and tightening credit, the furniture industry is in the midst of an unprecedented downward spiral as the consumer reacts to these events by postponing home furnishings and other discretionary purchases. Based on the magnitude of the change in our incoming order rates, we are taking immediate action to aggressively reshape our business so that are costs and inventories more accurately reflect the reality of the current operating climate.”
Darrow added, “Although we are making these significant changes and curtailing our expenditures on a number of projects that do not contribute immediately to the bottom line, we are continuing to move forward with investment in several major initiatives that are key to our profitable growth. These include our new cut-and-sew facility in Mexico, which is scheduled to open in January 2009, and the continued warehouse consolidation process of the La-Z-Boy Galleries dealer base.”
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