Signet Jewelers to Close Stores, Cut Staff Amid Declining Sales

Akron, Ohio—Signet Jewelers Ltd. is planning to revamp its business following a disappointing fourth-quarter and fiscal year. 

New CEO J.K. Symancyk laid out the jewelry giant’s plans during its earnings call Wednesday morning, which include a new turnaround plan that encompasses leadership changes, store closures and renovations, and a focus on brand loyalty.

The new plan, titled “Grow Brand Love,” was created in response to the company’s “lack of growth,” he said.

It will focus on “creating a clear distinction between brands to attract new and loyal customers that see themselves reflected in the DNA of each brand,” said Symancyk.

Historically, Signet has referred to the store chains in its portfolio as “banners,” but Symancyk wants to change how they’re perceived by consumers.

“Brands build loyalty with customers through emotional and engaging connections, while banners are transactional, literally a static nameplate on the door,” Symancyk said.

Its three largest brands, Kay, Zales, and Jared, have high consumer awareness, he said, but growth has been “elusive” so the company will work on building brand loyalty.

The company plans to add more design-focused jewelry into its assortment to promote gifting and self-purchasing while also expanding its position in the bridal market, which has been struggling in the wake of the COVID-19 pandemic.

The strategy will require a reorganization, including reducing the ranks of its senior leadership by 30 percent, he said.

The company also said Wednesday that it will be evaluating 150 underperforming stores, primarily in malls, over the next two years and decide whether they should be closed or improved.

There are also plans to renovate 200 locations and possibly relocate another 200.

“Nearly 200 doors in our fleet have healthy performances but are in venues that we believe are in decline,” Signet Chief Financial, Strategy and Services Officer Joan Hilson said. “Over the next two to three years, we plan to reposition many of these stores to off-mall locations.”

This means that 550 stores, or roughly a quarter of Signet’s fleet, are up for closure, renovation, or relocation.

For the quarter ended Feb. 1, Signet’s overall sales totaled $2.35 billion, down 6 percent year-over-year and below its expectations.

Same-store sales slipped 1 percent.

For the full year, sales totaled $6.7 billion, down 7 percent year-over-year and also falling short of expectations.

Same-store sales fell 3 percent.

The bridal market has been struggling since the COVID-19 pandemic, weighing on its sales, but Hilson said the “engagement recovery” is continuing.

Symancyk said the company plans to grow its share in the bridal category (currently around 30 percent) through “assortment and price-point architecture,” leveraging its in-house design capabilities, adding modern designs, and working with its vendor partners.

As for fashion jewelry, he said the company may be able to increase its market share through gifting for milestones and other special occasions as well as self-purchasers.

The retailer also has plans to consolidate its repair services.

Signet provided an update on its holiday season sales in January, noting its performance fell below expectations, with same-store sales down, particularly in the days leading up to Christmas.

The company pointed to poor sales of fashion jewelry as the culprit, noting that consumers were looking for deals and it did not have enough lower-priced jewelry to meet their needs. 

“We will continue to make changes to our assortment this spring to drive improvement for the next two major gifting seasons, Mother’s Day and the winter holidays,” Symancyk said.

In North America, Signet’s banners include Zales, Jared, and Kay Jewelers, as well as Peoples in Canada.

Signet’s fourth-quarter sales in the region totaled $2.22 billion, down 6 percent year-over-year, while same-store sales in the region were down 1 percent.

For the full year, sales in North America totaled $6.3 billion, down 6 percent year-over-year with same- store sales declining 4 percent.

Signet’s international banners include U.K. stores Ernest Jones and H. Samuel.

International quarterly sales totaled $126.2 million, falling 11 percent year-over-year, with same-store sales down 2 percent.

For the full year, international sales totaled $372.3 million, tumbling 13 percent with same-store sales down 1 percent.

Signet expects first-quarter sales to total between $1.5 and $1.53 billion, with same-store sales flat to up 2 percent.

For the full year, the company forecasts sales of $6.53 to $6.8 billion, with same-store sales down 3 percent to up 2 percent.