Retail has undoubtedly been a sector filled with struggle and closures in recent months, perhaps even years. Increased rates of inflation hooked onto the price of goods and does not appear to have any plans of releasing consumers from this burden anytime soon. Stores that offer non-essential items like clothing, jewelry, or makeup are often the first to feel the heat during tense economic times as shoppers have to seriously prioritize how their money is spent.
Kohl’s, the popular department store chain has not been faring particularly well in recent months and as such, the retailer has been exploring various options of restructuring and downsizing in order to minimize costs without having to resort to a bankruptcy protection filing. Department stores in general have struggled to bonce back after the pandemic caused a shift in preference to online shopping. Growing competition and shrinking demand has revealed a path of incredibly uncertain times for retailers of both essential and non-essential goods.
Kohl’s tests out a discontinuation of its third-party return service
The department store giant began the year on a rather sad note after it announced that it would be closing the doors of twenty-seven branches by April due to underperformance. This announcement coincided with the news that close to ten percent of the corporate workforce would also be laid off, likely as a result of the consistent decline in sales recorded over the last few quarters.
With the hopes of cutting costs further, the retailer has now decided to test out a discontinuation of its Amazon return service at selected stores. The department store initially introduced this third-party return service for Amazon orders with the goal of bringing a sorely needed boost in sales to the store. By 2019, just about every Kohl’s location offered this convenient service to its shoppers. The retailer shared that this partnership had drawn in around two million new customers to its stores. However, over the years, whilst Amazon continued recording sales increases, the same could not be said for Kohl’s and the department store giant has not since recorded any new notable gains.
A spokesperson for the department store shared that move is just a temporary test as the company tries to figure out the best way to cut costs during these economically tense times.
“To continue to learn from our customers, we are conducting a test in a handful of our stores where we will be temporarily discontinuing the third-party returns service,” the spokesperson for Kohl’s explained. “Kohl’s has a test-and-learn culture that helps us to evolve our store experience and stay informed about customers’ expectations and preferences.”
The Eau Claire; Washington, Missouri; and Leominster, Massachusetts Kohl’s locations have been selected for the initial rollout of this this trial and it appears that store employees are breathing a sigh of relief at the change, according to posts found on Reddit made by users who claim to be associates at Kohl’s.
One post read, “I hope they do this overall, Amazon is a headache and can’t be worth it with the amount of work and man hours it takes to do it.”
Another user also claimed that, “All those Amazon hours would be better spent on just about anything.”
Future plans for the retailer
It is not yet known whether this partnership will be discontinued permanently or not. However, it has now been made quite evident that the company’s relationship with Amazon is not adding to the bottom line, not to mention its negative impact on employee morale.
Amongst other changes, the company will also be welcoming in a new CEO once Tom Kingsbury retires in May. Perhaps a change in leadership and a fresh perspective could usher in an era of boosted sales and growth for the department store chain during these difficult times.