Jide Zeitlin, CEO of Tapestry Inc., owner of Coach, Kate Spade and Stuart Weitzman, is being selective about which employees get to work from home amid coronavirus. Corporate workers are working remotely, but for distribution center employees and in-store associates, it’s nearly business as usual.
An email Glossy obtained, sent to Tapestry corporate employees by Zeitlin on March 12, states: “A key fact-based learning about Covid-19 is that ‘social distance’ matters in reducing the rate at which the disease is spread. As such, and consistent with steps that colleagues in China took weeks ago, we are moving globally to new ways of working.”
So, beginning Friday and through March 27, workers in the New York, New Jersey and London corporate offices would be working from home, he went on to say. But it would be a different story for in-store associates.
“As a retailer, we are mindful that colleagues in stores do not have the same ability to work from home. We are in close contact with all of our stores and are monitoring regional impacts. We will continue to communicate as we learn more and adjust our approach across our retail network,” he stated.
An email sent minutes later, from an email labeled Tapestry News, said Tapestry’s corporate facilities in Jacksonville and Ohio — both distribution centers — will continue to operate normally. “We are monitoring the situation for these teams,” it stated.
On Sunday morning, the company began announcing to its customers the plans for its stores. Separate notes to the email subscribers of Kate Spade, Stuart Weitzman and Coach included the same information: The company will be shortening store hours in all of its locations, from noon to 7:00 PM, from March 15 to March 27. In addition, employees will be cleaning frequently throughout each day. Store associates will be paid for all the hours they were scheduled to work.
Many Tapestry stores routinely operate from noon to 6:00 p.m. or 7:00 p.m. The altered store hours mainly affect stores within malls, which typically open at 10:00 a.m. and close at 9:00 p.m. However, many malls are now shortening their hours or temporarily closing altogether, and other retailers have acted quickly to close their doors.
When asked about Tapestry’s response to the coronavirus outbreak, Andrea Shaw Resnick, Tapestry’s global head of investor relations and corporate communications, sent an email statement: “We are closely monitoring and assessing the impact of the Covid-19 pandemic and modifying our store policies as the global situation evolves. Our priority remains the health and wellbeing of our employees, their families and our customers.”
The three brands’ social media managers have, for the most part, stuck to their editorial calendars rather than address the pandemic. Across Facebook, Instagram and Twitter, recent posts point to International Women’s Day and Women’s History Month. Coach is milking its J.Lo partnership with regular images of the singer, plus it’s hyping a #CoachOriginals campaign, asking customers to post their handbag collections.
Only one post, across all three brands and their channels, pointed to the coronavirus: On Saturday, Kate Spade posted an image of a pink floral print to its 2.8 million followers, along with the caption, “In this uncertain time, our hearts are with yours.” It opened the floodgates for its followers, including in-store employees, who responded with comments criticizing the company’s move to keep its stores open.
“Choosing to stay open in the midst of a global pandemic values profit over people,” one stated. “Close your stores and pay your employees. There is absolutely no reason why a corporate employee should be able to post this from home while hundreds of others are forced to open a storefront today.”
Another posted: “Close your stores! Shortening hours just leads to more people being in the store at the same time, and totally contradicts social distancing and preventing the spread! Put your employees and customers before greed!!”
Tapestry Inc.’s earnings for the second quarter of fiscal 2020, reported on Feb. 6, surpassed estimates, with net sales increasing 1% year over year, to $1.82 billion. But at the same time, Tapestry Inc. lowered its total fiscal 2020 projection to $5.9 billion, as a result of the coronavirus’ impact on the business in China alone. Tapestry’s store closure rate in China dipped to nearly 90% but is now at less than 10%. The company expected sales for the second half of the year to be hit by up to $250 million, said Zeitlin on the earnings call.
At the end of the quarter, Tapestry was operating 1,575 stores globally, including 31 stores that were added during the quarter. In North America alone, the company had 393 Coach stores, 222 Kate Spade outlets and 72 Stuart Weitzman stores.
“In the luxury space, the experiential component is really important, and there’s a huge disruption there when it comes to losing that,” said Natan Reddy, senior analyst at CB Insights.
He said, along with implementing innovations on the delivery and fulfillment levels, large corporations that proactively made their brands’ e-commerce sites experiential, enabling them to act as substitutes to what can happen in-store, will fare better amid this crisis. He listed Diane von Furstenberg with its virtual shopping experience, DVF 360, as a strong example.
“Yes, fashion is going to take a hit,” he said. “Now is the time to engage customers online.”
In the email to employees, Zeitlin stated that he’s confident in his decision to move corporate employees remote, based largely on Tapestry’s experience facing coronavirus in China: “Our corporate teams in China have been working from home for several weeks without missing a beat. When we talk about resilience and the ability to come through moments of uncertainty closer and stronger, China represents tangible evidence of this, even as they continue to navigate still stormy waters.”
Editor’s Note: After this story was published, Tapestry announced it will close its stores from March 18 through March 27.