US: The Wet Seal lays off 41 workers
The Wet Seal is axing 41 employees as part of cost-cutting strategies that will also result in a lower marketing spend at the retailer.
In addition to the job cuts, the company has decided against filling ten currently vacant positions, it said.
It means in total that 49 positions have been eliminated in the company's corporate offices and two in the field, The Wet Seal said. Affected employees were provided with severance packages.
The reductions are expected to result in annualised pre-tax savings of approximately $4.3m beginning in fiscal 2008, but the company expects to incur a one-time charge of approximately $0.4m in its fiscal 2007 fourth quarter.
The company also plans to reduce marketing expenditures by approximately $1.8m next fiscal year, primarily by eliminating national print advertising programs deemed ineffective by management.
Ed Thomas, The Wet Seal chief executive officer, said: "The company is undergoing a review of various business functions, with the goal of increasing profitability.
"Unfortunately, the review has identified the need to reduce our corporate workforce. We very much appreciate the contributions of the affected associates to the company's past success and regret the need to take these actions."
As of 5 January, the company operated a total of 498 stores in the US.
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