As a part of its ongoing restricting program, apparel chain Esprit plans to lay off 1,200 employees globally, including 100 in its Hong Kong office and 800 store employees in Germany. Job cuts follow the closure of 56 stores across Asia, outside Mainland China. The company plans to close 50 more stores in Germany, which accounted for 17.2 per cent of the group’s total revenue in the year to June 30. It has received court approval to open insolvency proceedings for its German subsidiaries allowing it to continue with the self-administration process under which it will streamline its business in Europe.
Another part of the company’s restructuring plan includes renegotiating contracts with service providers to obtain more favorable terms. These initiatives will lead to savings of around $116 million for the company, but the one-off costs of the restructuring will add up to about $64.5 million in the June 2021 year. Esprit’s management team is currently working to create a consistent customer experience across all touch points by improving its production quality and sustainability credentials and focusing on full-price sales.