NEW YORK, United States — Downtown fashion institution Opening Ceremony laid off 23 employees on Thursday, including much of its design staff, according to people with firsthand knowledge of the situation.

The cuts are a sign of trouble for the retailer, known for its downtown cool, innovative fashion shows and collaborations with the likes of Spike Jonze and Chloë Sevigny. The company has expanded globally and once had plans to open stores devoted to its in-house label.

But since early 2018, Opening Ceremony has reduced its corporate staff by at least half in multiple rounds of layoffs, said one source familiar with the company’s operations. The most recent round of layoffs was the biggest yet and affected nearly everyone that worked on Opening Ceremony's in-house collection. There were also cuts to other departments, including e-commerce.

Four people on the design team were laid off, according to another source with knowledge of the restructuring.

Opening Ceremony had 180 full-time employees as of March 2017, according to a New Yorker profile on the company. In an email statement, Opening Ceremony co-founder Carol Lim said the cuts were part of a broader shift in strategy.

"We have made a decision to streamline some of our departments to maximise efficiency and better align our cost base with our growth plan," she wrote. "We are honing the focus on our strongest channels including our retail and e-commerce, our collections and collaborations which involved rethinking the structure of our corporate teams."

In 2002, Lim and Humberto Leon founded Opening Ceremony as a multi-brand store on Howard Street on the edge of Soho and Chinatown with a concept inspired by their love of travel and the Olympics: every season, the retailer showcased a curated roster of designers from a new country alongside a home team of emerging talent from the US.

Soon, the business expanded to include a showroom, where it represented several of the brands that Lim and Leon sold in the store, as well as a private label collection that staged unconventional fashion shows that were sometimes more like theatre. Most recently, they staged a show in March at Disneyland in Anaheim, California.

Their private line is currently sold at the retailer's four locations in New York, Los Angeles and Tokyo, as well as other stores such as Barneys New York, Bergdorf Goodman and Ssense. The Tokyo store was launched in partnership with Onward Holdings Co. Opening Ceremony also had a store in London's Covent Garden that has closed.

In 2014, private equity firm Berkshire Partners acquired a minority stake in the Opening Ceremony business. The investment was led by Berkshire's partner firm, Front Row Partners, whose chief executive Glen Senk became chairman of Opening Ceremony's board (Senk is the former chief executive of Urban Outfitters and David Yurman).

At the time, there were plans to open news stores in Boston, Chicago and San Francisco that would sell Opening Ceremony-branded merchandise only, according to a report in the Los Angeles Times. However, those plans never materialised.

Since January, the retailer has been looking for a new investor, according to a report by Women's Wear Daily.

Lim and Leon, who met as students at University of California at Berkeley, are also the co-creative directors of Parisian label Kenzo, which is owned by LVMH.

Related Articles:

[ Carol and Humberto Say 'Everything Came From a Personal Point of View'Opens in new window ]

[ Opening Ceremony's Fashion TheatreOpens in new window ]