Galeries Lafayette sets up job protection plan at Guérin Joaillerie 6 months after buying Mauboussin
Feb 21, 2020
French department store group Galeries Lafayette has set up a job protection plan for its struggling Guérin Joaillerie jewellery brand, with about 240 employees. Guérin is set to disappear, to the advantage of Mauboussin - which was bought by the group last summer - as part of a restructuring of Galeries Lafayette’s jewellery division.
“A job protection plan, [known in France as PSE], is in place for Guérin,” a spokesperson for Galeries Lafayette told French agency AFP, adding no further details.
Guérin, which celebrated its 50th anniversary last May, is therefore going to disappear as the company will stop trading, to the advantage of Mauboussin: 19 Guérin stores and retail corners are set to become Mauboussin, and another 15 are said to be slated for closure. Finally, three stores, with about 30 employees, are going to be sold, said Arnaud Gamblin, a representative of the FO trade union.
According to Galeries Lafayette, the PSE concerns “163 employees.” They will be offered alternative employment, but with jobs “paid 20% to 30% less, and in distant locations: it’s truly shocking,” said to AFP an employee who wished to remain anonymous.
“Management wants to wind down the PSE ,” which became effective on December 17, “by mid-March, but time must be allowed to manage human resources, and give negotiations a chance,” said Gamblin.
Guérin Joaillerie was bought by Galeries Lafayette from its founder Didier Guérin in 2012. It is one of two brands in the group’s jewellery division, the other being Mauboussin, in which Galeries Lafayette bought a 55% stake last summer - for an undisclosed sum - and whose expansion it is keen to bolster. The watches division instead consists of Louis Pion (affordable watches) and Royal Quartz (a more upmarket range).
Premium repositioning of Guérin Joaillerie didn’t work
According to the Galeries Lafayette spokesperson, “with regards to Mauboussin, which is on a profitable growth track, the group will be focused on accelerating the development of this affordable jewellery brand in the course of the next few years.” She added that Mauboussin’s “market positioning is similar to Guérin’s.”
In January, in a letter addressed to Guérin employees which AFP has seen, the group's senior management said that “the new premium brand strategy introduced for Guérin Joaillerie unfortunately didn’t produce the results expected. Despite all our efforts to grow the brand and its revenue, from introducing a more upmarket product range to lease renegotiations, revenue has continued to decline.”
The letter also mentioned “recurring losses, despite the fact that the shareholder injected up to €25 million to offset the deficit,” adding that “more than half of the stores generated negative operating income.”
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