Gerry Weber's parent company is in suspension of payment. The German fashion chain wants to make a fresh start, but not before they've been thoroughly restructured. 230 stores will need to be closed, putting 900 jobs at risk.
Restructuring won't suffice
Last week, Gerry Weber International requested suspension of payment and received it. The company admitted to higher costs than expected in the past financial year and was faced with a disappointing loss: 44.2 million euros of added expenses led to an overall loss of 192.3 million euros for the year.
While the year before had seen a profit of 10.3 million, a loss of 148 million had been predicted for the past one. The chain also knew that turnover would drop by 10 percent, back to 795 million euros. "We're getting the needed flexibility and we're laying down a solid groundwork to bring the company back to its old strength," said Florian Frank (who was in charge of the restructurings) at the time.
Now that the results have turned out even worse than expected, it's become clear that Gerry Weber won't make it on these restructurings alone. The necessity of closing 230 stores was known back in December, but back then there was also talk of a "new, sustainable funding concept" which was supposed to be completed by the end of January. That concept may have been dropped, which would explain why the group is now seeking protection from its debtors.
900 jobs and 230 stores at risk
Up to 900 jobs will now be lost. The group employs a total of 6500 employees, has 1200 of its own stores, about 300 franchised stores and 2500 shop-in-shops. The dismissals will occur on all levels of the company, including in logistics and in the main office. Which stores will be closed has not yet been announced.
Despite all of this, Dutch director Herbert Blom called Gerry Weber "a healthy company" in the Netherlands. "We will be asked to watch our expenses, but since we turn a profit, no shops will have to be closed over here," he explained to RTL Z.