Moda Operandi, the online luxury retailer best known for its designer trunk shows, is shuttering the menswear side of its business after less than two years in operation.
“As a result of the economic impact to the fashion industry caused by Covid-19, Moda Operandi has made the difficult decision to sunset our men’s division, and focus on our core business around Women’s Fashion, Fine Jewelry, and Home products,” said a Moda Operandi spokesperson in a statement. “We are extremely proud of and grateful to our men’s team, who will remain at Moda Operandi through the second quarter to help wind down the business.”
Though it’s true that the COVID-19 pandemic has had a devastating impact on many businesses––not to mention human lives––there were signs of trouble at Moda before the news of downsizing broke on Friday. In January of this year, the company made a sizable cut to its staff, laying off at least 50 people, according to Business of Fashion, and closing its Chinese arm only a few months after launching it in 2019. Entering that market was a key goal of CEO Ganesh Srivats, who came to the role from Tesla, in light of increased competition from the likes of Farfetch and Net-a-Porter.
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Moda Operandi is shutting down its #men’s business as the coronavirus pandemic crushes demand even among top tier shoppers. The online retailer started selling men’s collections, in season and through its trunk show model, in June 2018 to capture a rapidly growing luxury menswear market. In a report last week, Bain & Company said the luxury market could lose between €60 to €70 billion in sales this year, with losses peaking in the second quarter. Other analysts expect up to a 35 percent contraction in the market. “As a result of the economic impact to the #fashion industry caused by COVID-19, Moda Operandi has made the difficult decision to sunset our men’s division, and focus on our core business around women's fashion, fine jewellery and home products,” said a representative for Moda Operandi in a statement. Employees who support the men’s team will stay employed until the end of June. Moda Operandi started off 2020 with layoffs, cutting about 50 people across the business and shutting down offices in Shanghai in January before securing $100 million in equity and debt financing from existing investors, including New Enterprise Associates and Apax Digital. Read the full story on businessoffashion.com [Link in bio] 📷: @modaoperandi
After the layoffs, the company quickly closed $100 million in equity and debt financing from its current crop of established investors, including New Enterprise Associates and Apax Digital, according to WWD. The terms of that financing are not publicly known nor how long it can last Moda given the current climate. Even more established, heritage retailers like Neiman Marcus are developing bankruptcy strategies as the global economic downturn continues.
Those on Moda’s menswear team are purportedly staying on through June. The men’s section of its website is currently promoting a 25 percent off sale.