UK high street fashion chain Ted Baker is understood to be cutting more than a quarter of its workforce as the retailer battles weak consumer spending and a channel shift to online.
The struggling clothing group is said to have informed staff this month that at least 500 roles will be axed in a bid to save GBP6m (US$7.5m) by the end of the year, according to The Sunday Times. About 200 will go at its headquarters in London, and the rest from retail stores and concessions.
A spokesperson for Ted Baker said: “Ted Baker confirms that as part of our continuing transformation plan, we have been assessing the appropriate level of staffing across our business and are in consultation with affected colleagues.
“We have not taken this decision lightly and would like to thank all our colleagues for their hard work and commitment. However, we believe this is necessary in order to transform Ted Baker and create a more sustainable business in the future.”
Last month, the fashion retailer raised GBP105m (US$131.2m) in capital to reduce its debt and invest in new efforts to try to turn the business around after posting a near GBP80m annual loss earlier this month on earnings of GBP30.7m a year earlier.
Underlying gross margin narrowed to 55.6% from 59.8%. Total revenue, meanwhile, was down 1.4% to GBP630.5m due to significant discounting across the apparel industry, particularly in the UK, in response to weak consumer spending and a channel shift to online. Retail revenues fell 4.6% to GBP439.9m.