In a challenging Chinese market where demand has fallen, the beauty retailer is downsizing its workforce. According to the subsidiary of the LVMH group, “less than 3%” of its 4,000 employees in China would be concerned.
Bloomberg has earlier reported that 10% of the workforce would be affected, but Sephora told AFP the operation would not impact more than 120 jobs.
As the Chinese economy slumps, the LVMH-owned company seeks to streamline its organizational structure in its headoffice to ensure its “future growth in China.” The retailer said it will provide compensation and career support services to those impacted.
Sephora has around 340 stores in China. The retailer, like other global cosmetics giants, is facing a slowdown in consumption in the country, one of the world’s leading markets for luxury and cosmetic products. Many companies have flagged a substantial decline in China sales, reflecting broader economic woes as the country is in the grip of an unprecedented crisis in its vast real estate sector and still-weak consumption.
Last March, Sephora had announced it would terminate all its online and offline operations in South Korea. In this country, the beauty retailer was facing fierce competition from very well-established local players.
