Stitch Fix shut the mill it bought in 2017 and dropped its size-inclusive private label

Retail Dive reported on Oct. 7, 2022 that Stitch Fix was closing a Pennsylvania cut-and-sew factory and knitting mill, with the loss of 56 jobs, according to a filing with the state's labor department. The company had bought Mohnton Mills in 2017 to make Mohnton Made, a sustainable, size-inclusive private label for men and women, which would now be discontinued. Stitch Fix promised severance that rises with tenure, extended healthcare and recruitment resources.

The closure came as Stitch Fix cut expenses to stem losses. In June it had cut about 330 positions, 15% of its salaried workforce. In its latest fiscal year net revenue fell 1.4% to $2.1 billion, net loss grew to $207.1 million from $8.9 million, and it lost 370,000 customers in the latest quarter, 9% of its active client base. A spokesperson called it 'an incredibly difficult decision' made to focus on returning to profitable growth.

Stitch Fix said dropping the label would not derail its inclusivity goals: about 70% of its owned labels were size-inclusive and it still aimed for all exclusive brands to be by fiscal 2025. Retail Dive noted it joined Old Navy in widening its range for more customers, only to pull back soon after.

Stitch Fix's net loss widened sharply and it was losing active clients, so it cut costs across the business.

The mill existed to make one private label, Mohnton Made, which was discontinued with the closure.

The company framed the decision as part of increasing active clients and optimizing its cost base.

A vertically integrated side bet, bought for sustainability and inclusivity, is among the first things cut when a retailer's core is losing customers.

Stitch Fix said its size-inclusivity goals remained and that many name brands it sells have size-inclusive offerings. It did not comment on what it would do with the Pennsylvania site.