Marionnaud Group announces 700 job lay-offs
This cut represents a lay-off of 17 per cent of the total number of Marionnaud workers in France. It will affect 659 positions in 370 stores and 45 head office positions. In spite of this, the company has said that they will not be closing any retail outlets.
Marionnaud has been experiencing some difficulties over the past three years, even before the full effects of the economic crisis took hold on the industry. Over the past three years, it is reported to have made losses of €250m.
The company told WWD that the job cuts were a necessary action, in spite of a slight improvement in company performance in 2008. William Koeberle, chief executive officer of Marionnaud Group said: “The very difficult current economic context, added to the severe shrinkage of the market and the resulting intensification of competition, has degraded our position”.
On Monday, Maurionnaud France management presented key parts of a redeployment plan, which outlined a strategy to reduce operational costs by 20 per cent along with this redundancy plan.
Part of wider trend for decline
These job cuts is the latest in a series of significant lay-offs which have been taking place across the cosmetics industry generally, and is symptomatic of a period of severe economic difficulty. BASF cut its workforce by 2000 in May, whilst Revlon announced 400 job losses at the end of last month. To see a complete timeline of the recent job cuts in the cosmetics industry, click here.
Marionnaud was acquired by AS Watson, the retail division of Hong-Kong based conglomerate Hutchinson Whampoa, in 2005. Watson have an enormous portfolio of global retail outlets. It invested €60m in Maurionnaud when the company was acquired.
The chain has reportedly budgeted €12m to renovate 80 per cent of its French network by the end of this year, in an effort to improve company performance.