Administrators at The Body Shop have announced they will axe 300 jobs at head office, while dozens of its 198 stores in the UK are likely to be closed with the likely loss of hundreds more jobs.
Last week The Body Shop went into administration as it endures a trading slump after only two months under its new owner, German private equity firm Aurelius.
Administrators FRP Advisory told staff on 20 February that workers at its offices in London Bridge and Littlehampton in West Sussex were being cut by 40% to 400. It added seven stores would close immediately with up to half of the total number being closed over time.
The retailer employs more than 2,200 people in the UK with 750 staff based at its head office.
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The stores that will close immediately include four in London, where rents and other overheads are highest. The seven stores that will shut on Tuesday are: Surrey Quays (London), Oxford Street near Bond Street (London), Canary Wharf (London), Cheapside (London), Nuneaton (Warwickshire), Ashford (Kent) and Bristol Queens Road .
Joint administrators Tony Wright, Geoff Rowley and Alastair Massey from FRP said: “After years of unprofitability and following a full evaluation of The Body Shop’s UK business, the joint administrators have concluded that the current store portfolio mix is no longer viable. As an immediate step, seven stores will close today, with additional closures to follow. It is expected that at the conclusion of the restructuring, more than half of The Body Shop’s 198 UK stores will remain open.”
They added that a reduced store footprint would help a renewed focus on the brand’s products, online sales channels and wholesale strategies, “bringing the brand in line with industry peers and supporting a return to financial stability”.
Aurelius bought The Body Shop at the end of last year from Brazilian beauty company Natura. Prior to Natura, the company, which was set up by Anita Roddick in the mid 1970s, was owned by L’Oréal after a £652m deal made shortly before Roddick’s death in 2007.
The chain’s performance over the festive period was “worse than [their] worst-case assumptions”, according to Aurelius, prompting the move to call in administrators.
The Body Shop’s future in its international markets is also in doubt after being sold to a group called Alma24, which has links to Aurelius. The German division, which has about 60 stores, was put into insolvency last week and workers in Belgium, where there are about 16 stores, have been told it is also headed for insolvency.
The Body Shop’s fair trade suppliers who work with local communities of growers and producers across Central and South America, Africa and Asia say they have been left with more than £790m worth of beauty ingredients.
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