Tapestry to cut 2,100 part-time employees, furlough others
Cutting salaries and letting go approximately 2,100 part-time employees are among the steps Tapestry is taking to mitigate damage caused by the covid-19 pandemic.
“With the passage of time, we are facing increasing pressure on the financial performance of the business, requiring us to make difficult decisions to ensure that Tapestry and its brands continue to thrive well into the future,” said Jide Zeitlin, chairman and chief executive officer. “These decisions are balanced with numerous steps to moderate the impact of the current environment on our people.”
The parent company to luxury brands Kate Spade, Coach and Stuart Weitzman said it will extend salary and benefits to the majority of its North America retail team through May 30th, at which point most store managers and sales associates in stores that haven’t re-opened will be furloughed. However, approximately 2,100 part-time store associates across the three brands will lose their jobs effective April 25th.
There will also be a 50% reduction in compensation for the board of directors and for Mr Zeitlin, and 5% to 20% reduction in salary for corporate employees above a certain salary threshold. Tapestry warned that the company anticipates making additional reductions to the corporate workforce.
Tightly managing inventories will also be part of the group’s strategy, which it will do by “reflowing late spring and early summer product introductions and cancelling inventory receipts for late summer/early fall 2020”. There will also be a reduction in capital expenditure by delaying or cancelling new store openings and prioritising investment in "high-return projects aligned with the multi-year growth agenda — notably in digital".
