WJBK Fox 2: Matthew Roling on Shinola layoffs
Detroit-based Shinola has always prided itself for hiring Detroiters and for the high-end watches they create. Now though, they've laid off nine employees and plans to outsource some of their operations. The luxury goods retailer is laying off nine employees and outsourcing leather design and product development in an effort to remain competitive in a fast-changing retail landscape. Matthew Roling is the interim chair of the accounting department at Wayne State Mike Ilitch School of Business. He says Shinola is discovering how expensive it is to create their high-end watches. "It all comes down to whether or not the perception to the consumers will survive the maturation of the company as they try to right size the cost structure," Roling said. "There's a reason that most of our retail goods are made in the developing world: labor is a lot less expensive. I think they've found it very difficult to make those products here in the U.S. and make a profit." Shinola says the move to outsource leather design and product development will help put the company on a path to profitable growth while still making high-quality leather goods. "I think they've really tried to position themselves as a luxury brand, it just might feel kind of foreign to your average person in the Midwest or someone who does come from a vulnerable economic background," said Roling.
