Vivarte ́s restructuring: the way back to discount

French fashion group Vivarte is going through a major restructuring. The retailer announced a 1,600 jobs cut right after it reported a 10.3 percent dip in turnover over the last fiscal year. As a consequence, nearly 1 in 3 clothing stores will close in the coming months.

Vivarte – parent group to brands such as Naf Naf, Chevignon, Kookaï or La Halle aux Vêtements – will axe 10 percent of the 17,000 jobs it currently has over the coming months.

One of its better known chains, La Halle aux Vêtements, will carry a big deal of the 1,600 total jobs cut, as it will be forced to close down 174 of its 620 stores and to sell off another 23. Consequently, its staff will be brought down from 4,000 to 2,480 employees.

Meanwhile, footwear chain André will also have to let between 200 and 500 of its employees go as 37 out of 247 stores will close. Additionally, Kookaï may be forced to make 32 people redundant.

Back to affordable clothing

Looking ahead and once the restructuring has been completed, Vivarte will shelf its previous plans to get an upgrade to become an upscale fashion group – main idea of former CEO Marc Lelandais - to get back into discount process.

As many in the market highlight, Lelandais´ decision to move Vivarte into a higher market has backfired badly, burdening the group´s turnover by 10.3 percent over its 2013-2014 fiscal year, down to 2.68 billion euro.

In the meantime, Vivarte´s debt grew to 2.8 billion euro. La Halle aux Vêtements' sales dropped for the third year in a row, with a 60 million loss on a 560 million euro turnover last year, recalls French trade press.

 

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