Almost the entire Farfetch top management has resigned after the takeover by Korean e-commerce company Coupang. The acquisition is also resulting in numerous redundancies lower on the food chain.
Clash
The acquisition by Coupang, last month, has left things reeling at the luxury platform. Almost the entire board of directors, including CEO José Neves, has resigned with immediate effect, The Business of Fashion reports. The split comes after disagreements over the new direction the platform should take. However, it looks as if the new owner will also restructure on a ‘lower’ level and immediately implement a major round of redundancies in the coming week.
Not much is known about Coupang’s strategy at the moment. The company is reportedly looking to target Asian and American markets. A number of subsidiaries may be sold off, such as make-up formula Violet Grey and trainer web shop Stadium Goods.
Pandemic
The platform is struggling with the decline of e-commerce after the pandemic, as well as increasing competition from luxury brands that are starting to sell straight to consumers. Luxury group Kering, for example, has recently announced it will sell more directly and less through the platform.
Another source of income has been cut short of late: the company also makes its expertise in online luxury sales available to other retailers (it built webshops for Harrods and Chanel, among others), but brands are cutting costs in that area too. In 2022, Farfetch had gross sales of three billion dollars thanks to 1,400 connected brands and shops. Still, the company is now only worth a fraction of its 2018 stock market valuation of 24 billion dollars.
