Leading swimsuit maker Victoria’s Secret is quitting that tested business. The news came from a note by Citigroup to the analysts that the chain would cease selling swimwear after 2016 and the current store space will be used for sports-centric activewear line.
According to Citi analysts, Victoria’s parent company L Brands “will be eliminating swim from stores and online.”
The rationale of the decision was explained off as the category “trended down over the last several years and management believes store space will be better used for VS Sport.”
According to BuzzFeed News, the chain has also announced chopping off 200 jobs and eliminating certain “merchandise categories” for focusing on “core” goods.
It quoted a spokesperson of the company saying that the company has “nothing to offer beyond our earlier release,” and more details will be shared in the May earnings call.
In August, the company reported lower sales for swimwear, saying it missed fashion and designed complex swimsuits, which Sharen Turney, former head of Victoria’s Secret called a “biggest disappointment.”
Les Wexner, the head of L Brands is now overseeing Victoria’s Secret. He said the changes are to accelerate growth and to “strengthen the business for the long term by narrowing our focus and simplifying our operating model.”
Wexner also hinted a move away from the famous catalogues and reorganising the business into three divisions– lingerie, beauty, and Pink brands.
However, the decision surprised many analysts as it came after a rosy outlook on the segment in May 2015. The projection was that Victoria’s swimwear segment has the potential to grow into a $1 billion business.
Currently, Victoria’s Swimwear business is $500 million and for parent company L Brands, it is 6.5 percent of the total sales.
Some analysts see the exit decision having been spurred by the lower sales of swimwear launched in 2015 August. Apprehension was that the acceptability of those overly-complex swimsuits with the mix-and-match of designs got affected by the enhanced curves, reports the Business Insider.