US retailer The Gymboree Corporation is to cut the salaries of its senior management by 10-15% as it looks to reduce expenses in response to the downturn in consumer spending.

In addition the company will reduce salaries by up to 10% for senior field management and corporate staff from 4 January.

"Our management group prides itself on being aggressive, being prepared and holding ourselves accountable," said Matthew McCauley, chairman and chief executive officer.

"While the financial position of the company remains strong with over $100m in cash and no debt, the salary reductions we are implementing are just a piece of a broader strategy to be prepared for next year.

"Our current sales trends are in the range of our previous guidance, but there is clearly weakness in the consumer sector and we expect further deterioration in the consumer markets.

"While it is too early to provide formal guidance for fiscal 2009, based on our expectation of continued weakness in consumer spending, we believe that our 2009 earnings will be below 2008 levels even after implementing our expense reduction strategies."

Last month the children's wear retailer posted a 15% rise in third quarter profit to US$30.9m, as retail sales rose 6% to $261.3m and same-store sales fell 2%.