Michael Kors to cut two-thirds of staff at French HQ
Luxury ready-to-wear brand Michael Kors intends to cut two-thirds of the staff at its French HQ. FashionNetwork.com has learnt that a redundancy plan first presented to the employees of the label's Parisian office in January was approved by Direccte (the regional authority for enterprise, competition, consumption, work and employment) on Thursday, May 2. The plan affects some 20 employees of the company's French subsidiary, who will discover exactly which positions are being cut in the next few weeks, with some roles possibly being relocated to London.
In order to justify the redundancy plan, Michael Kors has highlighted the brand's declining results in France. Indeed, in the first three quarters of fiscal 2019, the company's operations in the EMEA region saw an 8.8% decrease across both wholesale and retail sales.
The brand's French HQ currently employs around 30 people, who are responsable for sales and press operations in France and Benelux, as well as merchandising and franchises in the EMEA region. Sources close to the matter explained to FashionNetwork.com that Michael Kors is looking to change its organizational structure in Europe, refocusing its operations around two main offices in London and Milan. In the Italian fashion capital, a brand new showroom is set to become the home of the brand's commercial and customer service teams, while Paris, Madrid and Munich will host smaller offices with reduced roles. In Munich, between five and ten employees have already been made redundant in the office's press and strategy departments this Spring.
Among the 20 employees affected by the redundancy plan in Paris, a dozen could be relocated to London. The remaining six to eight people will be moved to a showroom and offices set up near the Michael Kors boutique on Paris' Rue Saint-Honoré, according to information obtained by FashionNetwork.com.
The brand itself is yet to reply to a request for comment.
Michael Kors is owned by Capri Holdings, accounting for 80% of its revenues, which totaled $3.89 billion in the first three quarters of fiscal 2019. Currently operating through 870 stores and concessions worldwide, the American brand saw its sales decrease 3.6% to $1.276 billion in the third quarter. Over a period of nine months, Michael Kors' sales remained more or less stable, registering a 0.5% increase.
Owned by John D. Idol, Capri Holdings purchased Jimmy Choo in 2017 and finalized its acquisition of Versace in January of this year. In 2020, the company, which is now planning to purchase British footwear brand Kurt Geiger, expects to achieve revenues of $6.1 billion, of which $4.55 billion will come from Michael Kors.
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