Is Cotopaxi Going Out Of Business 2024?

You might be wondering: Is Cotopaxi going out of business if you have heard about the company’s recent layoffs and prior events?

This year, so many well-known brands, such as Kelly Moore, Jaclyn Cosmetics, Hertz, etc., faced a disastrous fate. So, it is obvious to think if Cotopaxi is heading in the same race.

Cotopaxi is a well-known apparel brand and one of the few companies that is involved in contributing to charity and donations. The company seemed to be in good health, but the latest news about layoffs is raising eyebrows about the company’s fate.

So keep on reading to find out the truth behind what is really happening.

Is Cotopaxi Going Out Of Business

About Cotopaxi

Cotopaxi is a sustainable outdoor apparel brand that was founded by Davis Smith in 2014 in Salt Lake City, Utah. The brand is named after Cotopaxi, one of the world’s highest active volcanoes, and is dedicated to donating 1% of its revenue to nonprofits.

Davis moved a lot while growing up, owing to his father’s construction job. And when he was in South Africa, he witnessed the effect of poverty for the first time. This experience sparked a desire in him to help combat poverty to whichever extent possible, which is reflected in the motto of his brand today.

In 2014, Davis moved to Utah and founded Cotopaxi with the motto to help people in need. For this, he teamed up with his friends from Wharton, CJ Whittaker and Stephan Jacob, who became the brand’s co-founder.

Shortly after, they hired a team, got to work, and paved the way for a successful business.


Cotopaxi Implements Layoffs

Cotopaxi Implements Layoffs

The sustainable adventure brand Cotopaxi has laid off 22 workers recently, citing the reason for the company’s “restructuring.” The spokesperson for the company said that she can’t give more details about the layoffs.

“Cotopaxi had strong top-line growth this past year,” the company said in an interview, “but as with any company evolving to meet future needs, the company redesigned its organization to focus on its most important business priorities and on delivering the brand mission that has helped set new impact-driven benchmarks in the industry. A part of this redesign necessitated Cotopaxi parting ways with 22 people who have contributed to our business and our mission.”

As per the company’s impact report of 2022, Cotopaxi ended that year with 81 part-time workers, 209 full-time employees, and 29 temporary workers. Recent figures are, however, not readily available.


Cotopaxi Closes Its San Francisco Store

In 2022, the CEO of Cotopaxi, Davis, announced on his Linked In page that he had closed the only retail store in San Franciso because of rampant theft and compromised safety.

“As of today, we are closing the store due to rampant organized theft and lack of safety for our team,” Smith wrote. “Our store is hit by organized theft rings several times per week.”

Smith further elaborated that they opened the store a year before in the Hayes Valley neighborhood, but its windows were being repeatedly broken and merchandise stolen. In spite of installing iron grates and plywood, the thefts continued to happen.

A report released by the San Francisco Department of Homelessness and Supportive Housing in August revealed that 20,000 people, or 2.5% of San Francisco’s total population, were unemployed. Substance abuse, mental illness, unemployment, and dislocation were some of the reasons for the ruckus in the city.

Because of a lack of cooperation and action from the police, the company had to shut down its sole store in San Francisco.


Is Cotopaxi Going Out Of Business?

Is Cotopaxi closing

Cotopaxi laid off 22 employees recently and even shut down its San Francisco store in 2022, not to mention the resignation of Davis Smith from his position as CEO is making people wonder: Is Cotopaxi going out of business?

Well, not at all. Cotopaxi is in good health despite inflation and high inventory levels and is definitely not going out of business.

As mentioned earlier, the company laid off employees in order to restructure the company and closed down its San Francisco store due to continuous thefts. And Smith’s resignation is only a part of his succession plan.


What Are Cotopaxi’s Plans For The Future?

Cotopaxi already has a great reputation for selling high-quality backpacks, jackets, and other adventure gear.

But very recently, the company announced that it will be expanding into the cinematic universe as a sustaining sponsor at the 2024 Sundance Film Festival.

The company expects to grow a lot in 2024. You will have to keep an eye on the latest news of the company to find out exactly how they are going to achieve this.


Wrap Up

Cotopaxi is a profitable and growing adventure apparel brand. The company is dedicated to charity and combating poverty.

The recent news about layoffs raised questions like: Is Cotopaxi going out of business? However, that is not the case.

The company is planning to restructure itself and is all set to expect new growth by the end of 2024.


FAQ’s

Is Cotopaxi profitable?

Yes, Cotopaxi has been profitable for the past four years and till now has assisted over four million people living in poverty.

Why did Davis Smith resigned from Cotopaxi?

After 10 years as CEO, Davis Smith resigned from his position in 2023 to lead a mission for his church in Brazil for three years.

Who is the current CEO of Cotopaxi?

Damien Huang took over as the new CEO of Cotopaxi after Smith stepped down from his position.

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