Versace has confirmed it will make 350 job cuts in a bid to return to profitability by 2011.
Gian Giacomo Ferraris, chief executive of Gianni Versace, told Bloomberg that the restructuring plan he originally proposed in October had been approved by the family, shareholders, banks and unions and said that the deal was “the guarantee that our plan as we organised it will succeed.”
According to reports, Versace has signed a preliminary agreement with unions on job cuts in Italy as part of a plan to return to profitability in 2011.
The restructuring plan will involve the closure of Versace’s accessories factory in Burago, near Milan this month, followed by around 350 job cuts, which will be made between March and June.
Ferraris told Bloomberg: “The plan is based on a 360-degree reorganisation and drastic internal measures but it guarantees Versace’s future and independence.”
Ferraris also cited the autumn 10 launch of a lower-priced womenswear line as a key driver in Versace’s return to profitability. The Italian luxury label has introduced a womenswear element to its existing Versace Collection ready-to-wear menswear line. The womenswear line is also be called Versace Collection and is a wholesale-only label. It is forecast to achieve sales of more than €8m (£7m), in its first season.
Versace will also open four new company-operated standalone stores this year, in Las Vegas, Melbourne, Mumbai and Beijing, as well as relocate its Shanghai store in Shanghai, Ferraris said.