As tough times continue for the retail sector across the globe, job cuts and salary cuts have become a part of every retailer’s business strategy today.
In another strategic move, L Brands, which owns Victoria’s Secret, has announced the cutting of 850 corporate jobs. Ever since the announcement, the shares of the company too have risen by 5.5 per cent.
The job cuts, which constitute 15 per cent of its corporate staff, are seen as a part of retailer’s goal to save US $ 400 million every year.
With 5 months still to go before 2020 concludes, L Brands hopes to save US $ 175 million by the end of the year.
While stating that Victoria’s Secret is doing well and job cuts are necessary for its long-term growth, Andrew Meslow, CEO, said that the management is focused on improving the profitability of Victoria’s Secret business.
Cash saving is one of the key strategies the brand is working on! And as a part of this strategy, L Brands plans to shut down around 250 stores of Victoria’s Secret before the year ends.
Besides, there are reports that the retailer is working closely with its suppliers to bring down merchandising costs as well.
L Brands, which plans to come out with its Q2 report on 19 August, expects Victoria’s Secret sales to go down by 40 per cent in the second quarter.
L Brands, which also owns Pink and Bath & Body Works, generates revenue of US $ 12.914 billion.