The house of Versace has announced plans to lay off 350 staff, in a frank admission that major cost cuts will be needed to return the fashion business to profitability. Calling the move part of a “comprehensive corporate reorganisation,” the house said in a press release that the radical downsizing was “designed to increase efficiency, return the group to profitability in 2011 and ensure its future growth prospects. Trading conditions in the wake of the global financial crisis have been severe and the Company expects to make a loss in 2009,” CEO Gian Giacomo Ferraris said in the release.
As a result, Versace plans to rationalise production facilities and review its extensive store network. The house quietly shut the doors of four boutiques in Japan in September and ccording to the house’s website has 93 boutiques in its global network, including 10 in North America, 26 in China, eight in Italy and five in Russia.