Five losses in a row
Charles Vögele has been struggling for some
years: for the fifth year in a row sales dropped (last year -4.4%) and the company made
a loss of 90 million euro in the past fiscal year. Despite implementing a one
brand strategy and internal reorganisations, causing hundreds of lay-offs, the
company continues to pile up losses.
Two months ago the Swiss had said to consider withdrawing
from Eastern Europe, but now the company confirms closing all of its locations in
Poland and the Czech Republic. Hungary, Slovenia and Austria, also grouped as
Eastern Europe activities, will remain open.
“Cutting out loss-making country organizations
would enable Charles Vögele to reduce complexity within the company and focus
on core markets.” Those core markets are Germany, Switzerland and Austria.
Exit from Benelux?
The question remains what the effect will be on
the activities of the company in the Benelux. Charles Vögele has 148 shops in
the Benelux, worth about 11% of gross sales. It is however no secret that the
Swiss are also suffering from the crisis in that region.
According to the Neue Zürcher Zeitung the
withdrawal from Poland and the Czech Republic is the start of a broader
geographic shift. The Swiss newspaper writes that sooner or later Charles
Vögele will also leave the Benelux, where margins are even smaller than in
Eastern Europe, although unions are stronger.
At the end of 2012 Charles Vögele had 812 shops
in Switzerland, Liechtenstein, Germany, Belgium, The Netherlands, Austria,
Slovenia, Poland, Hungary and the Czech Republic and a total of 6,743
employees. Three years ago that were 857 locations and 7,729 employees.
