300 jobs to be lost in McNaughton closing

Clothing company to shut 2 facilities in Hanahan after divestment by parent Jones Apparel Group

Clothing company to shut 2 facilities in Hanahan after divestment by parent Jones Apparel Group

Brad Nettles
The Post and Courier/File

Workers at Norton McNaughton prepare garments for shipping at their Goose Creek distribution center in 2003.

A major clothing company plans to close its distribution operations in Berkeley County by early next year, affecting almost 300 jobs — the county's largest layoff this year, state employment officials said.

McNaughton Apparel Group, owned by clothing giant Jones Apparel Group Inc., recently notified the state Employment Security Commission that it plans to close its two Hanahan warehouses. The buildings, measuring about 300,000 square feet each, are in the North Pointe Industrial Park off North Rhett Avenue.

The closing stems from Jones Apparel's decision to shed some of its moderately priced clothing lines by the end of this year. Those lines include McNaughton, which makes the Erika women's clothing brand, among other labels.

The divestment plans also include closing some distribution centers and offices, the company said in a recent financial report. "The objectives of the plans were to eliminate unprofitable or marginally profitable lines of business and reduce overhead expenses," the report said.

A Jones Apparel spokeswoman said Thursday that the Hanahan facility will close by Jan. 31, affecting 286 workers.

The decision to close the distribution center was "not made lightly," the spokeswoman said. But in the long haul, the move will help "streamline the company's distribution and improve its cost structure," she said.

McNaughton opened its first clothing distribution center in Hanahan in 2000. Jones Apparel bought the company in 2001 and opened a second Hanahan warehouse in 2002. The center processes shipments of the Erika brand.

New York-based Jones Apparel is a clothing conglomerate known for brands including Jones New York, Nine West, Anne Klein and Gloria Vanderbilt. It recently sold its high-end department store chain, Barneys New York, to a Dubai-based investment company.

Like many retailers, Jones Apparel has struggled in recent months as shoppers have reined in spending, faced with economic factors such as a housing market slump. Also, a number of moderately priced clothing makers have suffered as department stores have replaced these brands either with their own private-label apparel or with more upscale merchandise.

Jones Apparel posted a $47 million loss on revenue of $905 million during the second quarter, and recently scaled back its full-year forecast.

The closing of the company's McNaughton facility in Hanahan marks Berkeley County's largest layoff this year, said Gwendolyn Richardson, area director for the Employment Security Commission. Employees at the facility will be eligible for job-placement services and retraining under the state's Workforce Investment Act, she said.

A "rapid response" team made up of representatives from various state agencies, including the Commerce Department and Employment Security Commission, will meet with workers before the distribution center closes, she said.

Richardson said she was optimistic that the employees would be able to find other jobs in the area. "The growth here is very good and opportunities are available," she said.

Berkeley County economic development officials also remained upbeat about job prospects.

"We'll do what we can to replace those jobs," said county economic development director John Scarborough.

The area has a good list of industrial prospects, and the soon-to-be vacant buildings in North Pointe Industrial Park could be desirable for some of them, Scarborough said.

"That type of warehouse is lacking in the Charleston area," he said.

Industrial real estate is a hot commodity in the Charleston region, fueled by the planned expansion of the Port of Charleston.

While much of the attention is focused on the corridor along Interstate 26 west of Summerville, where large tracts of undeveloped land are still available, the McNaughton site in Hanahan has a lot to offer industrial companies, said Bob Barrineau, a commercial broker with CB/Richard Ellis Carmody in Charleston.

In addition to the site's proximity to I-26 and Charleston-area ports, the buildings are modern, functional and climate-controlled, said Barrineau, who works in the real estate firm's port practice group.

"Demand for space in port markets is good," he said.

Reach Caroline Fossi at 937-5524 or cfossi@postandcourier.com.