Lululemon to Close Washington Distribution Center, Lay Off 128 Workers

Lululemon Athletica, a popular apparel retailer, announced plans to shut down its distribution center in Washington state by the end of the year. This decision will result in the termination of more than 100 employees, according to information provided to Reuters.

The company, headquartered in Vancouver, is taking this step as part of its efforts to streamline operations and improve efficiency. The closure of the Sumner distribution center will lead to 128 job cuts starting from June 21, as stated in a WARN notice filed with the state’s Employment Security Department.

The move comes amidst a slowdown in demand for Lululemon’s high-end athleisure products in North America. Excessive inventory levels at sporting goods retailers have led to reduced orders for sportswear and apparel companies across the board.

“We regularly review our distribution network to align with the future goals of our business,” explained a spokesperson for Lululemon.

The lease for the Sumner distribution center, spanning 150,000 square feet, is set to expire in July 2025, as per regulatory filings.

However, some of the affected employees may have the opportunity to retain their jobs by relocating to other facilities, including the recently opened distribution center in the greater Los Angeles area.

In 2021, Lululemon signed a new lease for a massive 1.26 million-square-foot distribution center in Ontario, California. This lease is valid until 2039, according to the company’s annual filings.

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Despite this move, Lululemon still owns a distribution center in Groveport, Ohio, and leases the majority of its other facilities across the United States, Canada, and Australia.

The retailer’s shares have experienced a decline of over 31% since the beginning of the year, reflecting broader challenges faced by the company in the current market.