High-end clothing retailer Nordstrom is shutting down all 13 stores in Canada and laying off 2,500 employees after failing to make a profit in America's neighbor to the north.
The company has already shuttered its ecommerce operations in the country. The decisions come as Nordstrom tries to shrink its footprint to ensure financial stability.
"We took decisive actions to right-size our inventory as we entered the new year, positioning us for greater agility amidst continuing macroeconomic uncertainty," said Erik Nordstrom, chief executive officer of Nordstrom, Inc., in an earnings release.
"We also made the difficult decision to wind down operations in our Canadian business. This will enable us to simplify our operations and further increase our focus on driving long-term profitable growth in our core U.S. business."
Like many retailers, Nordstrom has ramped up discounts and markdowns in recent quarters to keep its inventory levels in check. It's also struggled with slower sales due to inflation, which isn't expected to go away anytime soon.
“We expect that elevated inflation and rising interest rates will continue to weigh on consumer spending, especially in the first half of the year," said Michael Maher, interim chief financial officer, in an earnings call.
The closures in Canada are set to take place by June.
The incoming Fed decision will likely be good news for consumers with high-yield saving options, but bad news for borrowers (like anyone with high credit debt).
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