• by Sarah Mahoney  @mahoney_sarah, January 9, 2024

Rent the Runway just got another size smaller. The subscription fashion company is reducing corporate staff by 10% and streamlining the executive suite.

Anushka Salinas, currently president and chief operating officer, has resigned. And her duties will be taken over by Jennifer Hyman, chief executive officer and co-founder.

In a filing with the Securities & Exchange Commission, the New York-based company says it expects the new plan to achieve between $11 million and $13 million in annualized savings. The reductions will also incur between $3 million and $4 million in costs as a result, with $2 million to $3 million in severance.

The Wall Street Journal reports that it is looking to expand marketing efforts, however, and is on the hunt for a chief marketing officer, a role it had not had since 2020 when it eliminated many jobs due to pandemic-related changes in consumer behavior. In a restructuring plan introduced in 2022, Rent the Runway eliminated 24% of its corporate workforce.

Last month, the company posted third-quarter results hinting at the scope of the struggle, with revenue falling 7% to $72.5 million and active subscribers slipping 2% to 131,700 thousand. It trimmed its losses a bit, with a net loss of $31.5 million, as compared to $36.1 million in the comparable period of the prior year.

At that time, Hyman told investors the company was making progress in slowing subscriber churn and increasing customer satisfaction, and it had modified its debt structure.

The company continues to tweak offers, selections and pricing. That includes “The Vault,” a new category of luxury evening wear styles from top designer brands featuring new-to-site designers that include Etro, Oscar de la Renta, Brandon Maxwell, and Anna October.

The restructuring “realigns the business around growth, eliminating the roles of around 10% of the corporate workforce, and streamlining management structure,” Rent the Runway said in a statement emailed to Marketing Daily.

“The company has worked over the past several years to shore up critical aspects of the customer journey to propel growth in 2024 and beyond and is now focused on investing more into areas of the business that reignite the growth funnel, including marketing, consumer product, customer experience and more.”

It adds that the new structure is set up to help the company achieve break-even levels in free cash flow this fiscal year.

Rent the Runway is far from alone in financial struggles. Last month, Stitch Fix announced that sales fell 18% in the most recent quarter and that it expected a decline of 19% in the current quarter.

At the RealReal, which focuses on luxury resale, revenues dropped to $133.2 million from $142.7 million in the prior quarter, posting a loss of $22.9 million. And Farfetch, a struggling luxury sales platform, recently got scooped up by Coupang in a $500 million bailout.