*Hanover Discontinues Three Catalogs as Cost-Cutting Measure
The discontinuation of the catalogs is part of what the Weehawken, NJ, company described Friday as a strategic realignment plan designed to lower costs. The cataloger will eliminate 285 full-time equivalent positions across all business units. The move is expected to save approximately $26 million in annual payroll and related non-payroll expenses.
The company will terminate the lease on its Maumelle, AR, fulfillment and telemarketing facility and will consolidate its Keystone fulfillment operations in Hanover, PA.
It will direct resources primarily toward profitable catalogs, including The Company Store, Domestications, Improvements and Silhouettes.
The announcement came one month after Rakesh Kaul resigned as Hanover's president/CEO. He was replaced by former Barney's New York executive Thomas Shull.
Kaul's resignation came after several money-losing years. In 1999, the company lost $16.3 million on $549.9 million in revenue following a $25.6 million loss on $546.1 million in revenue in 1998.
In October Hanover announced it would suspend publication of Turiya, an upscale bedding and linen catalog, only one year after it was launched. The Turiya brand was integrated into Gump's By Mail and The Company Store.
Nearly four years ago, the company announced a plan to cut costs by $50 million annually. This included the closing of excess warehouse capacity in Hanover, PA, and the elimination of excess telemarketing capacity in Roanoke, VA. At the end of 1996, the company announced the elimination of 550 jobs and outlined a plan to reduce marketing expenditures.